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Global economy will not be able to get out of crisis in 2021 - study

11 April 2021 12:36

MOSCOW. KAZINFOM Forecasts that the global economy will overcome the crisis caused by the coronavirus pandemic in 2021 are not justified, according to a study from experts at the Higher School of Economics together with the Russian Union of Industrialists and Entrepreneurs.

«Against the background of new waves of the pandemic that have engulfed many countries in recent months, it is already obvious that the initial forecasts of a full-fledged recovery of the global economy from the crisis in 2021 are not being justified,» the study said, TASS reports.

The experts noted that, the factors that negatively influenced the global economy in 2020 have not yet been eliminated. «Different intensities of quarantine restrictions and different rates of vaccination against COVID-19 in individual countries, as well as the emergence of new dangerous strains of the virus, will continue to negatively affect the state of national economies and global supply chains,» experts believe.

All this means, the report concluded, that «governments will need to adapt their economic policies to the conditions of a longer recession.» At the same time, the prospects for economic recovery will depend not only on government actions, but also, to a large extent, on plans and expectations at the level of enterprises.

Strengthening role of state

During the pandemic, the state has demonstrated its ability to effectively help businesses - however, interfering in pricing and strengthening the role of state-owned companies can lead to negative consequences, according to a study.

«The crisis pushed both companies and the state to actively interact. At the federal level, the state has demonstrated the ability to talk with business. The result of such interaction was the prompt solution of a number of problems of industry regulation and the mitigation of certain restrictions,» the study said.

In addition to direct support, businesses were aided by measures that positively affect demand - various financial instruments for direct support of the population during the crisis.

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