Eurozone – 2021-2022 scenario: a uniform exit from the pandemic, an uneven exit from the economic crisis

Eurozone – 2021-2022 scenario: a uniform exit from the pandemic, an uneven exit from the economic crisis
  • Q4 2020: after the crash and rebound, learning how to be resilient
  • Looking back at 2020
  • 2021: benefiting from the recovery elsewhere before beginning a local recovery
  • Fiscal policy: a positive push, still largely nation-driven
  • ECB: managing the delayed recovery
  • Risks: delayed, not avoided
  • Growth forecasts

En résumé

With a more severe GDP contraction in 2020 (-6.8%) and more modest growth anticipated for 2021 (4%) and 2022 (4.1%), the COVID crisis has widened the growth gap between the Eurozone and the other major advanced economies. The new economic and mobility restrictions have led us to moderate our forecasts for the start of the year. Still, the better outlook for the second half of the year means we can expect business to return to its pre-crisis level sooner (second quarter of 2022) than forecast in our December scenario.

Eurozone – 2021-2022 scenario: a uniform exit from the pandemic, an uneven exit from the economic crisis

The risks are more balanced than they were a few months ago. The centralised management of the vaccination campaign is expected to ensure that countries will exit the pandemic at a similar pace. On the other hand, the end of the economic crisis will be more uneven, although the ramping-up of the European funds is likely to reduce that fragmentation.

Paola MONPERRUS-VERONI, Economist