| Summary/Abstract |
The year 2021 saw fast recovery of the global economy following the worst recession since the end of World War II. Thanks to vaccine R&D and increasing vaccinations, the second wave of the pandemic took a lesser toll on the world economy. The recovery was boosted, to varying degrees, by the fiscal and monetary policies adopted by countries in response to the pandemic. Looking ahead, the world economy in 2022 will be shaped by the following short-term factors: uncertainty of the pandemic and side effects of the response policies, compounded by the problems that had existed before the pandemic, and the direction and intensity of future policy adjustments in major economies. From a longer perspective, debt has climbed to an all-time high; population is ageing fast in major economies; productivity growth has slowed; consensus is yet to emerge on the negotiation of the reform of the multilateral trading system; financial regulation is weighed down by long-standing loopholes; energy transition is moving forward amid difficulties; and economic nationalism and particularly resource nationalism is on the rise. In view of these trends, the author believes that a 4.5% expansion of the global economy is highly probable in 2022.
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