Tashkent, Uzbekistan (UzDaily.com) -- According to the report, the prospects for global economic recovery are subject to a high degree of uncertainty, which is mainly associated with the unpredictable development of the COVID-19 pandemic.

According to the forecasts of the Eurasian Development Bank (EDB) experts, possible delays in the development and distribution of stable vaccines and restrictive measures may lead to a greater decrease in the potential for global economic growth.

Other sources of risk include the likelihood of the UK leaving the EU without a deal, as well as increased protectionism in world trade, and the instability of the geopolitical situation.

Eurozone GDP is forecast to increase by 4.5% in 2021 after a 7.5% decline in the current year, the USA - by 4.1% after a decrease by 3.7%, China - by 8.5% after an increase on 2%. The average price of Urals crude oil in 2021 is expected to be at US$49 per barrel after falling to US$41 in 2020.

II. The authors of the report note that the COVID-19 pandemic has led to widespread social and economic disruption. According to EDB estimates, by the end of tenge, the GDP of the Bank’s member countries will decrease by 3.8% after growing by 1.7% in 2019.

In Armenia, the economy will contract by 6.4%, in Belarus - 1.5%, in Kazakhstan - 3%, in Kyrgyzstan - 7.5%, in Russia - 4%, in Tajikistan - 4.5%.

As the EDB experts note, the Armenian economy continues to decline. At the end of January-September of this year, consumer and investment demand decreased under the influence of the negative consequences of the coronavirus pandemic and the aggravation of the conflict in Nagorno-Karabakh.

The country’s GDP is projected to grow by 4.9% in 2021 and by 6.7% in 2022. Faster economic recovery will be hampered by the restrained nature of business activity in the world and continued foreign policy tensions in the region.

In Belarus, the decline in the country’s GDP for 10 months of this year. amounted to 1.1%. Consumer and investment demand is limited by: 1) increased uncertainty amid socio-political tension; 2) a decrease in the volume of market lending; 3) weak financial performance of enterprises; 4) a slowdown in the growth of incomes of the population and social distancing.

According to the EDB forecast, the country’s GDP in 2021 will decrease by 0.1%. At the same time, a possible deterioration of the investment climate, the outflow of a significant part of the IT sector and labor resources will lead to a decrease in the technological effectiveness of the economy and the loss of human capital, which will be expressed in a reduction in growth potential. If an unfavorable scenario develops, the likelihood of a deeper economic downturn in 2021 is high.

In Kazakhstan, the decline in the country’s GDP following the results of 10 months of this year. amounted to 2.9%. Consumer and investment demand is limited by:

1) partial preservation of quarantine measures;

2) suspension of investment projects;

3) a decrease in the volume of market lending and real incomes of the population; 

4) the weakness of foreign economic activity. These factors will continue to have a key impact on business activity in the coming months.

Kazakhstan’s GDP is projected to grow by 4.4% in 2021, and by 4.2% in 2022. At the same time, a possible tightening of anti-Russian sanctions may have a significant negative impact on the Kazakh economy.

In Kyrgyzstan, the decline in the country’s GDP following the results of 10 months of this year. reached 7.4%. Consumer and investment demand is limited by:

1) weakness of foreign economic activity;

2) partial closure of borders with China; 

3) the consequences of previously introduced quarantine measures; 

4) suspension of investment projects.

In addition, heightened political uncertainty had an additional negative impact on the economic situation. It is expected that the gold mining sector will also make a negative contribution to the dynamics of GDP this year.

The country’s GDP is projected to grow by 3.7% in 2021, and by 5.1% in 2022. At the same time, a possible tightening of anti-Russian sanctions may have a significant negative impact on the economy of the republic. The risks of socio-political tension within the country may persist in 2021.

In Russia, the decline in the country’s GDP following the results of 10 months of 202 amounted to 3.6%. Consumer demand is constrained by the tightening of sanitary restrictions within the country. Potential economic growth will begin to recover in 2021-2022, which will be supported by the implementation of state development programs aimed at increasing investment activity.

At the same time, the likelihood of increased geopolitical tension and toughening of anti-Russian sanctions remains, which could have a significant negative impact on the business climate.

In Tajikistan, economic growth in January-September 2020 slowed down to 4.2%. At the same time, the dynamics of the country’s economy in 2021-2022 will be determined by the negative impact of the COVID-19 pandemic and the subsequent recovery processes. In 2021 and 2022, the improvement of the economic situation in the world will support the growth of the country’s GDP to 6.1 and 7.4%, respectively.

EDB experts believe that geopolitical risks, including the sanctions policy of Western countries towards Russia’s economic partners, may affect its economy. Internal political risks remain limited in the medium term.

In general, the authors of the report emphasize that a large-scale economic recession in the EDB countries was avoided thanks to measures of state support for the population and business.

These measures, according to EDB experts, in the coming years will contribute, firstly, to reimburse about 2-3% of GDP losses, secondly, to support the strengthening of household incomes, suffered from the effects of the pandemic. country.

EDB was established in 2006 as an international financial institution. Members of the bank are Russia, Kazakhstan, Belarus, Armenia, Kyrgyzstan and Tajikistan. Its authorized capital is US$7 billion.