đź“š Weekend Read: Regional Economic Outlooks| Climate Innovation | Productivity | Vaccines | Digital Money

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IMF Weekend Read

Dear Colleague,

Welcome to the Weekend Read! In today's edition we close the last official week of our 2021 Annual Meeting with a tour of the IMF's Regional Economic Outlooks. We also explore the areas of climate innovation, productivity, and look back at Annual Meetings events on globalism, food security and digital money.


Sub-Saharan Africa

Sub-Saharan Africa: One Planet, Two Worlds, Three Stories

The world remains in the grip of the COVID-19 pandemic and a seemingly accelerating pace of climate change, both of which underscore the need for increased global cooperation and dialogue. Solutions to these global problems must involve all countries and all regions, especially sub-Saharan Africa, with the world’s least vaccinated population, most promising renewable energy potential, and critical ecosystems.

Sub-Saharan Africa’s economy is set to expand by 3.7 percent in 2021 and 3.8 percent in 2022. This follows the sharp contraction in 2020 and is much welcome, but still represents the slowest recovery relative to other regions

Growing divergences: The economic outlook points to divergences at three levels: between sub-Saharan Africa and other regions, within sub-Saharan Africa, and within countries. These divergences reflect the region’s slower vaccines rollout, more limited fiscal space, and regional disparities in resilience. The outlook remains extremely uncertain, and risks are tilted to the downside. In particular, the recovery depends on the path of the global pandemic and the regional vaccination effort, food price inflation, and is also vulnerable to disruptions in global activity and financial markets.

Looking ahead, sub-Saharan Africa’s potential remains undiminished. The region is at a critical juncture to implement bold transformative reforms
to capitalize on this potential.

Read the Report

Watch the Press Conference

Western Hemisphere

Latin America's Long and Winding Road to Recovery

The outlook for Latin America and the Caribbean shows that an initial rebound in economic activity was stronger than expected as lockdowns were gradually eased; however, the recovery has been uneven and incomplete. Real GDP is projected to grow by 6.3 percent in 2021, followed by a more moderate growth of 3 percent in 2022.

Public debt has increased by more than 10 percentage points relative to 2019, and employment recovery continues to be slow. Inflation is also on the rise in many countries but is expected to revert to around 3 percent by 2023. Central banks in the region will likely face difficult trade-offs keeping long-term inflation expectations anchored amid increasing inflationary pressures and persistent labor-market slack.

A lasting legacy: The pandemic is expected to leave long-lasting scars in the region. Gaining medium-term growth momentum is crucial, especially in narrowing the gap opened by the pandemic and avoiding a further divergence relative to advanced economies. 

Countries should continue to allocate sufficient resources for health spending including vaccination and targeted support to households and firms. Policies should foster inclusive growth, including through progressive and growth-friendly tax reforms and measures to intensify climate change adaptation and mitigation.

Read the Report

Watch the Press Conference

Asia and Pacific

Asia Remains World’s Growth Driver, Though Uncertainty Remains High

Asia continues to offer the greatest support for the global recovery this year, though headwinds from the resurgent pandemic have dimmed the outlook somewhat.

The Asia-Pacific economy will rebound from last year’s contraction with 6.5 percent growth, led by China and India, according to the latest IMF projections. That represents a downgrade of 1.1 percentage point from the last Regional Economic Outlook in April, reflecting the spread of the more contagious Delta variant amid initially low vaccination rates. Still, even this slower pace of expansion would be the fastest of all major regions. Asia’s 2022 forecast was raised to 4.9 percent, though output in emerging and developing economies may remain below pre-pandemic trends in coming years.

Uncertainty ahead: Inflation remains a concern, but Asia’s pressures are more subdued than other regions. Surging commodity prices and supply strains have been relatively contained, keeping import prices from rising significantly and passing through to consumers.

Still, risks remain. The pandemic’s path is uncertain, supply disruptions could endure, and financial markets may turn volatile as the Federal Reserve scales back support for the U.S. economy. Natural disasters also pose a growing threat to Pacific Island nations and low-income countries.

Given these challenges, the latest assessment calls for policymakers to respond accordingly. They should first address the health crisis with swift vaccination and equitable sharing of vaccines. Economic support should continue where possible until the recovery is firmly established.

Read the Report

Watch the Press Conference

Middle East and Central Asia

Tradeoffs for Transformation in the Middle East and Central Asia

Since the beginning of this year, the Middle East and North Africa region has made good progress and the recovery is ongoing despite the new outbreaks. Yet, the recovery is uneven, incomplete, and fragile. In the Middle East and North Africa, real GDP growth is expected to expand by 4.1 percent in 2021 and 2022. In the Caucasus and Central Asia, real GDP is expected to grow by 4.3 percent in 2021 and 4.1 percent in 2022.

New challenges: With the emergence of new challenges, such as rising inflation and increasing inequities, countries will face delicate policy tradeoffs.  Ramping up vaccine acquisition and distribution remains the top short-term priority and will require strong global and regional cooperation. Additional fiscal support should be well-targeted and improving policy frameworks will be important to reduce tradeoffs. Rising inflation warrants close monitoring, and central banks may need to raise interest rates preemptively if inflation proves persistent.

The crisis presents opportunities that could lead to a transformational recovery for the region marked by more resilient, inclusive, and greener economies. Leveraging global trends, such as the use of digital technologies, will help improve the efficiency of safety nets and ensure the region stays competitive globally. Investing in climate-resilient technology will be key to addressing the global existential crisis while also creating new job opportunities.

Next week, the region's economic outlook, with a focus on the Caucasus and Central Asia, will be the subject of an October 27, 7 a.m. ET panel discussion focused on policies that can help the region emerge from the crisis. Register now. 

Read the Report

Watch the Press Conference or the Oct. 20 Panel Discussion on the Outlook


Europe's Recovery: Recalibration and Reallocation

An increasingly resilient recovery is taking hold in Europe, buttressed by gradual increases in vaccination rates and mobility. The Regional Economic Outlook for Europe now forecasts 5.2 percent growth for advanced economies and 6 percent for emerging economies in 2021.

Strongly accommodative macroeconomic policies and COVID-19 support schemes have paved the way for the recovery. However, uncertainty remains elevated due to risks of new infection waves and virus variants amid uneven vaccination rates across countries. It is therefore imperative to continue increasing vaccinations and to strongly support international efforts to speed up vaccine access globally.

Downside risks: For 2022 growth is projected at 4.4 percent in advanced European economies and 3.6 percent in emerging European economies. However, risks are tilted to the downside owing to potential virus mutations, prolonged supply disruptions, and high energy prices among others.

Moving forward, Europe faces two major post-pandemic policy challenges: controlling inflation and dialing back fiscal support. 

Read the Report 

Read a Blog

Watch the Press Conference

Finance & Development Magazine

F&D: Fighting Climate Change with Innovation


Innovation in institutions, understanding, technology, and leadership is critical to confronting climate change, Kelly Levin and Andrew Steer write in an article for our most recent issue of Finance & Development Magazine. Innovation in all of the above areas has brought the world to where it is on climate change and will drive further progress, they write.


Read the full article on the web or download a PDF.

Read the Full September Finance & Development Issue

Want to get a print copy delivered to your home or office? Click here.


IMF Podcast: Jayati Ghosh

In the second episode of our Women in Economics podcast series, Jayati Ghosh, professor of economics at the University of Massachusetts Amherst, says our whole notion of productivity is skewed because the work of unpaid caregivers is not captured in GDP.


Ending the Pandemic

On Monday, IMF Chief Economist Gita Gopinath and Head of the IMF's Global Health and Pandemic Response Taskforce Ruchir Agarwal presented a series of data visualizations on the effects the pandemic, the outlook for vaccinations, and highlighted several pragmatic actions to expeditiously defeat COVID-19 globally. 


The Future of Globalization

European Central Bank President Christine Lagarde reflected on globalization after pandemic during the annual Per Jacobsson Lecture this week. The powerful economic logic that led to the rise of globalization remains valid today but it is being challenged in important ways, she said.

Quote of the Week

“We have the science, and we have the technology needed to get shots in arms and to do the testing… We just have to make it available at scale to all parts of the world.”  

—IMF Chief Economist Gita Gopinath during an October 18 event, "A Roadmap to End the COVID-19 Pandemic."


01. When will Energy Prices Ease?

An unprecedented combination of factors is roiling world energy markets, rekindling the memories of the 1970s energy crisis and complicating an already uncertain outlook for inflation and the global economy, the IMF's Andrea Pescatori, Martin Stuermer, and Nico Valckx write in a new blog.

Spot prices for natural gas have more than quadrupled to record levels in Europe and Asia, and the persistence and global dimension of these price spikes are unprecedented. Typically, such moves are seasonal and localized. Asian prices, for example, saw a similar jump last year but those didn’t spill over with an associated similar rise in Europe. Our expectation is that these prices will revert to more normal levels early next year when heating demand ebbs and supplies adjust. However, if prices stay high as they have been, this could begin to be a drag on global growth. Read the blog.

02. The Digital Money Revolution

A digital money revolution will bring changes to the way we lead our lives. IMF Managing Director Kristalina Georgieva; Benoît Cœuré, head of the Innovation Hub at the Bank of International Settlements; and Eswar Prasad, professor, Cornell University and senior fellow at the Brookings Institution in an Annual Meeting seminar discussed the opportunities, risks and challenges, and the implications of central bank digital currencies.

“Technology creates a lot of wonderful solutions but relying on the technology to solve all these problems is going to be a path too far," Prasad said. "Governments are going to have to play an active role, but one that is not too intrusive.” Watch the event.

03. Food Security in Sub-Saharan Africa

In 2020, the number of undernourished people reached 264 million in Sub-Saharan Africa (SSA) as the COVID-19 pandemic compounded the food security challenges in a region that was already highly vulnerable to climate change. A panel consisting of IMF Deputy Managing Director Antoinette M. Sayeh; David Beasley, Executive Director, World Food Programme; Tahir Hamid Nguilin, Finance and Budget Minister, Chad; and Musa Kpaka, Chief Technical Advisor in the Office of the President, Sierra Leone discussed the evolving situation and possible solutions. Watch the event.

04. Capacity Development at the Annual Meetings

The capacity development series at the Annual Meetings ended this week with a signing ceremony launching a new cooperation between the IMF and the U.S. Agency for International Development on supporting economic institutions in the Caribbean, as well as an event on “Financing the Sustainable Development Goals” highlighting how countries can mobilize additional revenues to resume their progress toward meeting their SDGs. Read our recap here.

Chart of the Week


While most economic indicators deteriorated last year, house prices largely shrugged off the effects of the pandemic. Of the over 60 countries that enter into the IMF’s Global House Price Index, three-quarters saw increases in house prices during 2020, and this trend has largely continued in countries with more recent data. Read more in our latest Chart of the Week blog to learn what continues to drive housing prices up.


Adam Behsudi


IMF Weekend Read


P.S. Let us know how you liked our coverage of the 2021 Annual Meetings. Is there something you'd like to see more of? How can we improve our daily briefings? Feel free to write me a note directly.

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