The International Monetary Fund’s (IMF) World Economic Outlook has predicted the UK is likely to be the fastest-growing advanced economy in 2022. The outlook expected growth of 5.3pc this and then 5.1pc next year as it recovers from a massive GDP hits from the pandemic. This could be the UK’s strongest growth since 1988, although the IMF added output is not expected to return to the same levels from before the pandemic until next year.
It comes as the Government said today that 31.622 million Britons had received their first dose of a Covid vaccine, which is up from 31.582 million in the previous day’s data.
Gita Gopinath, chief economist at the IMF, said UK growth would be 0.8 percent greater than expected this year, due to the success of the vaccine rollout and additional economic relief announced by Chancellor Rishi Sunak in the Budget.
She said: “[The UK] is doing exceptionally well on the vaccination front and the expectation is that by sometime in July they will get to truly widespread coverage, in which case the economy opens up at that time so that is looking promising.
“Also there was the additional stimulus that was provided in the March Budget round.
“We welcome the extension of some of the lifelines into this year.”
Mr Sunak announced earlier this week that businesses could be helped with their recovery through Government-backed recovery loans of up to £10million.
Banks will offer between £25,001 and £10million under the scheme from today for the rest of the year, while interest rates will be capped at a maximum of 14.99 percent.
The Treasury also promised to cover 80 percent of what banks lend if businesses do not pay back the money.
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This will also be faster than expected after world GDP contracted by 3.3pc in 2020.
Over in the US, President Joe Biden’s $1.9 trillion (£1.37 trillion) stimulus package has helped with economic recovery, with US growth expected to reach 6.4pc in 2021, helping it surpass pre-virus levels in the first half of the year.
The country’s GDP is expected to also surge 6.4pc this year and 3.5pc in 2022.
Following its jab rollout struggles, the EU’s recovery may be slower.
The eurozone was is set to see growth of 4.4pc in 2021, which is being helped by a faster recovery in Italy.
However, European economies are expected to have almost returned to the same growth path as before the pandemic by 2024.
The IMF said: “Thanks to unprecedented policy response, the Covid recession is likely to leave smaller scars than the 2008 global financial crisis.”
The countries most at risk of a slow recovery are said to be emerging economies that have limited access to vaccines, as well as those with weak public finances and are heavily dependent on tourism.
The IMF said in its Global Financial Stability Report: “Buoyant financial markets have also contributed to an ongoing rally in the prices of risk assets, raising concerns about excessive risk taking and stretched valuations.”