OECD urges acceleration of vaccination to consolidate economic recovery

An office area in Manhattan, New York, was half empty last week.SPENCER PLATT / AFP

The arrival of coronavirus vaccines has also inoculated the global economy with a good deal of optimism.

But it will not be enough for a full recovery unless vaccination is accelerated and it is carried out more equitably around the world, as the Organization for Economic Cooperation and Development (OECD) warned on Tuesday.

Its latest quarterly assessment of the economy now forecasts robust global growth of 5.6% this year, 1.4 percentage points above its estimates at the end of 2020.

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"The global economic prospects have improved significantly in recent months, helped by the gradual deployment of effective vaccines, announcements of new fiscal support in some countries and by signs that economies are better coping with measures to eradicate the virus," summarizes the organism in its interim report for March, which illustrates graphically, with an upward growth rate represented by a syringe, alluding to the vaccination process against covid-19 that is already extending in much of the world.

However, "although we have improved the projections, I am still very concerned that we are not doing enough to accelerate the recovery," said OECD chief economist Laurence Boone, when presenting the report in Paris.

“Fiscal support is appropriate, but the rate of vaccinations is not fast enough to consolidate the recovery.

We have to go much faster and do it much better, ”he insisted.

Because there are still “considerable risks”, largely linked to the rate and extent of vaccination, the OECD warns: “Faster progress in the deployment of vaccines worldwide would allow restrictions to be lifted faster and improve confidence and spending, ”he says.

Within the countries themselves, it would also help "restore confidence, improve labor market conditions and reduce preventive savings."

Only in the 36 States that are part of the OECD, highlights the body, there are currently almost ten million more unemployed than before the crisis.

In contrast, a slow vaccination "would result in a weaker recovery, more job losses, and more business bankruptcies."

The difference between the good scenario - rapid vaccination - and the bad one in the OECD is "about six trillion dollars by 2022, that is, twice the economy of France," Boone staged.

For this reason, underlines the international institution, which once again insists on the importance of multilateralism, it must be a "priority" to ensure that everyone receives vaccines as soon as possible.

After all, he recalls, "the resources required to provide vaccines to low-income countries are small compared to the gains from a stronger and faster global economic recovery."

According to the interim report for March, also significantly titled

Strengthening the recovery: the need for speed

, after growing by 5.6% this year, in 2022 the rebound will remain at a not inconsiderable 4%, three tenths more than estimated last quarter.

The OECD also revises upwards, albeit more moderately, the growth of the euro area, which it now estimates at 3.9% this year (compared to 3.6% in December) and 3.8% in 2022 (five tenths more ).

Spain, which for the first time is included in these "interim" reviews between the two large semi-annual reports of the Paris-based organization, will also grow somewhat more than expected this year (5.7%) and next year (4, 8%), at rates above those of Germany or Italy, but behind France, despite the fact that the OECD revises its projections slightly downwards for this country to 5.9% (one tenth less than in December).

Another country that will grow vigorously in 2021, although somewhat less than initially expected, is China, for which the OECD now estimates 7.8% (8% in December).

However, the best performance - after India, which this year will grow by 12.6% - will be that of the United States, a country for which the OECD now projects an expansion of 6.5% this year, 3.3 points more than in December, and 4% in 2022. A piece of news closely linked to the stimulus package for 1.6 trillion euros of the new president, Democrat Joe Biden, approved by Congress last weekend and that the body with headquarters in Paris greets with evident enthusiasm, especially for its "welcome" demand side effects "on key trading partners."

According to estimates by the agency, which for the first time in several years (those of the

Trump era

) does not issue warnings about trade tensions in its report, the US package could stimulate demand in economies such as Canada and Mexico, which could see an increase of between 0.5 and 1 percentage point of its production, or of 0.25 to 0.5 points in the eurozone or in China.

The stimuli "are not just going to boost the US economy, but are going to fuel global growth, by increasing demand in the US and from the US to the rest of the world," Boone explained.

Faced with the welcome given to the measure of the new US Executive - although still cautious, since it has yet to be deployed - the OECD slaps the European Union on the wrist for its delay in deploying its own rescue funds, approved months ago. Europeans "must intensify their efforts to advance the disbursement [of approved funds] and make full use of available resources," claims the

think tank

of rich countries, which for the moment dismisses inflationary threats and warns against withdrawing tax aid too soon, although it recommends progressively adapting aid to the most affected sectors, especially young people. Because even with the prospects improving, most countries will not return to pre-pandemic levels until the end of the year or in 2022. That means, Boone stressed, that many countries “will have lost two or three years of growth, which which is very long and threatens to leave significant scars in terms of jobs and well-being ”.