Global outlook c h a p t e r 1



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community resistance
B. Range of model forecasts for 
COVID-19 cases in advanced 
economies


C H A P T E R 1 
G L O B A L E C O N O M I C P R O S P E C T S | J A N U A R Y 2 0 2 1 
35 
in 2020, more than any of the other EMDE regions. The 
forecast for 2021 is for a modest recovery, reaching 3.7 
percent growth as restrictions are relaxed, vaccines are 
rolled out, oil and metals prices rise, and external 
conditions improve. Six of the 10 EMDEs with the 
highest COVID-19 deaths per capita in the world are in 
LAC, including five of the region’s six largest economies. 
Risks to the outlook remain tilted to the downside, and 
include external financing stress amid elevated debt, a 
resurgence of social unrest, and disruptions related to 
climate change and natural disasters. 
Middle East and North Africa.
Output in the region is 
estimated to have contracted 5 percent in 2020, as 
countries struggled with significant disruptions from 
COVID-19 and a sharp fall in oil demand. This 
contraction adds to already slowing growth in the region 
and compounds pre-pandemic per capita income losses. 
Growth is expected to improve to a modest 2.1 percent in 
2021, as the pandemic is brought under control and 
lockdown restrictions are eased, global oil demand rises
and policy support continues. The pandemic is expected to 
leave lasting economic scars on the region, which will 
likely dampen potential growth going forward. 
Disruptions related to geopolitical tensions and political 
instability, renewed downward pressure on oil prices, and 
additional balance of payments stress are key downside 
risks to the outlook. 
South Asia. 
Regional economic activity is estimated to 
have contracted by 6.7 percent in 2020, led by a deep 
recession in India, where the economy was already 
weakened before the pandemic by stress in non-bank 
financial corporations. The region is projected to grow by 
3.3 percent in 2021 and 3.8 percent in 2022. By 2022, the 
level of activity is forecast to be about 16 percent below 
pre-pandemic projections, the largest gap of all EMDE 
regions. Risks remain tilted to the downside, and include 

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