Global outlook c h a p t e r 1

A. Increase in global extreme poverty 
headcounts by 2021
B. Duration of school closures 
C. Access to technology of EMDE 
schoolchildren
D. EMDE per capita GDP relative to 
pre-pandemic projections
with the probability of markedly worse-than-
expected outcomes being nearly five times higher 
than the historical average (figure 1.14.B). 
The collapse in global activity in 2020 is estimated 
to have been slightly less severe than previously 
expected, mainly due to shallower contractions in 
major advanced economies and a more solid 
recovery in China. Economic disruptions in many 
other EMDEs were worse than expected, however, 
resulting in a predominance of downgrades, 
including for large economies such as Argentina, 
India, Mexico, and Thailand (figure 1.14.C). 
Forecasts for activity in 2021 have also been 
revised down in the majority of both advanced 
economies and EMDEs, resulting in a downgrade 
to global growth.
The forecast for global growth depends on the 
weighting methodology being used. Advanced 
economies account for 60 percent of global 
activity according to the market exchange rate 
weights used in the baseline projections. In 
contrast, these economies only account for 40 
percent of global activity when using purchasing 
power parity (PPP) weights—a methodology that 
places greater weight on faster-growing EMDEs. 
Since advanced economies generally suffered 
deeper recessions and are forecast to have slower 
recoveries than EMDEs—especially China, which 
is rebounding particularly strongly—the profile 
for global activity is weaker when using market 
exchange rate weights compared to PPP weights. 
As a result, global GDP is estimated to have 
contracted 3.7 percent in 2020 and is forecast to 
expand 4.3 percent in 2021 using PPP weights—
slightly higher than the projections using market 
exchange rates (table 1.1). 
The baseline outlook assumes that pandemic-
control measures are able to reduce the daily 
number of infections in the first half of 2021. 
Moreover, the deployment of effective vaccines, 
which has begun in some countries, is envisioned 
to gather pace in early 2021 in advanced 
economies and major EMDEs, with widespread 
vaccination achieved by late 2021. The process for 
other EMDEs and for LICs is expected to take 
place with a lag of two to four quarters, 
respectively,