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challenge & recovery

We are in the midst of a global recovery, and in large part that will shape the economic outlook in 2021.

It certainly won’t feel like that everywhere, for all people and all businesses, but the recovery is definitely underway.

That recovery is one of three things I see shaping the outlook in the New Year. The second is how policy continues to evolve.

In a post-COVID 19 world, how policy is managed, and how the withdrawal of support is calibrated as economies get closer to pre-COVID levels of activity will be critical. This is already underway in places like China.

The third key issue is the strategic challenges that will continue through 2021 – namely climate, inequality and geopolitics.  None of these are going to go back to where they were before the pandemic.

On climate, we've very much learned how a massive disruption to our natural environment can impact the economy. The lessons we take from this will be critical.

Unfortunately, the deterioration in inequality through COVID-19 has been pretty eye watering, and that's going to be an ongoing challenge.

The final challenge will be geopolitics. That's clearly been in flux for a few years and COVID-19 has taken it to a new level. We’ll see how a new US President handles that in the New Year.

It feels like there couldn’t be more happen in 2021 than we saw in 2020 but next year, I think, has got plenty in store for the global economy.

Richard Yetsenga is Chief Economist at ANZ

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