The past year has been forbidding. The economic disruption has been grave and the social toll has been detrimental for many people. Still, one is tempted to ask, will 2021 mark the beginning of economic and social recovery, and healing from pandemic’s psychological scarring?
The discovery of several effective vaccines offers the hope of an end to the pandemic this year and, with it, “ignition”.
In concert with inoculation drives, governments will tilt towards lower lockdown stringency when it is safe to do so and production will step-up . The mixture of pent-up demand, high levels of personal savings, and the sheer delight to spend again points to a burst of consumerism. Moreover, the geopolitical backdrop is slightly more becalmed, public policy settings are supportive and firms’ capital expenditure programmes are enlivening.
Of course, the global recovery may be uneven and stuttering, and there is much that can still go wrong. There is also many grieving the loss of loved ones, and many more with wounded souls because of the mental and emotional drain of the pandemic. There’s probably never been a more poignant moment, at least in recent history, to amplify the need for a shared recovery.
Chief Economist, Standard Bank Group
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