A new report by The Economist Intelligence Unit (EIU) shows that the global economy will not recover to pre-coronavirus levels until 2022, with big disparities between countries.

Most G7 and BRICS economies will start to recover from the coronavirus-induced recession in the third quarter of this year, posting double-digit rates of quarterly growth. However, their recovery will start from a low base, given the economic shock experienced in the second quarter. This means that the economic rebound will be far less impressive than what headline figures will suggest.

Agathe Demarais, Global Forecasting Director at the EIU and author of the report, discusses the outlook for the G7 and BRICS economies:

“Our findings suggest that the third-quarter recovery will be far less impressive than the quarterly growth data will show. Most G7 countries will be back to levels of activity last recorded in 2016. Across G7 countries, recovery will be swift by international standards, owing to generous furlough schemes (which have prevented mass layoffs) and massive fiscal stimulus programmes. Conversely, the situation in developing countries is worrying. Brazil, Russia and South Africa have all lost nearly ten years of growth, and they will be in recovery mode until 2024 at least.”

Italy is an outlier among G7 countries. In the third quarter of this year, Italy’s output will be at levels last registered in 1997. This reflects the combined impact of previously stringent lockdown measures, a bleak outlook for the crucial tourism sector and the lack of fiscal space to boost the economy. Unsurprisingly, Italy’s recovery will also be slow, returning to pre-coronavirus GDP levels only in 2024.

Download the full report: A Q3 recovery, what Q3 recovery?