Following a collapse last year caused by the COVID-19 pandemic, global economic output is expected to expand 4 percent in 2021 but remain well below pre-pandemic projections. The pace of the recovery is forecast to vary considerably across EMDE regions, with more pronounced weakness in countries with larger outbreaks or greater exposure to global spillovers through tourism and industrial commodity exports. Many countries are expected to lose a decade or more of per capita income gains. Downside risks include the possibility of a further resurgence of the virus, more severe effects on potential output from the pandemic, and financial stress. The heightened level of uncertainty highlights policy makers’ role in raising the likelihood of better outcomes while warding off worse ones. Policy action will need to balance the risks from large debt loads with those from premature fiscal tightening as well as foster resilience by safeguarding health and education, improving governance, and enhancing debt transparency. 

https://www.worldbank.org/en/publication/global-economic-prospects