What has been the impact of the pandemic on long-term growth prospects?

The COVID-19 pandemic has caused major disruptions in the global economy. These are likely to deepen the expected slowdown in potential growth over the next decade, unless policies take a major course correction.  

Weakening growth potential

The pandemic will likely deepen the expected slowdown in major drivers of growth over the next decade, unless a comprehensive package of policy reforms is enacted to boost growth.

Downgrades in long-term growth prospects

Past recessions, e.g. the global recession following the global financial crisis more than a decade ago, were followed by several years of downgrades in long-term growth prospects.

Persistent income losses

Following the pandemic-induced global recession, the global economy is expected to witness a protracted period of below-trend output and substantial income losses. 

Reforms to boost growth prospects

A comprehensive policy effort is needed for a recovery that reverses the damage from the pandemic and builds back better. In the past, investors have recognized and anticipated the growth dividends of institutional reforms by upgrading their long-term growth forecasts.

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The global economy is heading for a decade of growth disappointments due to the pandemic-induced recession. A comprehensive policy effort is needed to rekindle robust, sustainable, and equitable growth.  

A comprehensive policy effort is needed to overcome the legacies of the pandemic and build back better. In the past, the growth dividends from reform efforts were recognized by investors to upgrade their long-term growth expectations.