The Delta variant is not incompatible with economic recovery. This is the opinion of Jean-Pierre Petit, president of the Cahiers Verts de l’Économie, invited by the Monaco Economic Board to decipher the impact of the health crisis on the world economy. Enough to reassure the Principality’s entrepreneurs and others.
“Is the Delta variant incompatible with economic recovery?” : this is the question that the Monaco Economic Board asked economist Jean-Pierre Petit, president of the Cahiers Verts de l’Économie. The answer is of particular interest to entrepreneurs in the Principality who wereent participation in the conference. The answer is no. It is not incompatible. To pay Jean-Pierre Petit, which refers to macroeconomic analysis and investment strategy advice, “we will continue to live with this virus, we will not eradicate it. Of course, cases can increase sharply with Variant Delta but vaccination limits the risk on the hospital system. Almost 30% of the world’s population is already doubly vaccinated, or nearly 50% of global GDP. ” (Photo DR: Jean-Pierre Petit at the podium and at the graphics during the MEB conference)
Towards 4% growth in 2022
According to the expert, the world economy has held up rather well with annualized growth of around 6% in the third quarter of 2021 and a fourth quarter which should also be economically satisfactory (5.5%), thanks to a good rebound in Asia of the East. The Delta variant would have “played more negatively on supply constraints than on demand via reduced mobility“… And for 2022, Jean-Pierre Petit is banking on 4% growth.
However, all is not perfect. Far from there. Effects of the Covid on production chains (raw materials, semiconductors, etc.), high inflation, and on the geopolitical level, a victory for the Taliban synonymous with an “American fiasco”, with all the consequences that this implies (in particular a diminished credibility of United States in competition with Beijing): the world situation remains difficult.
But by sweeping away the political news that risks impacting the markets (tensions between China and the United States, threat to Taiwan, elections in Germany), the economist without tongue in cheek was positive, and bet on the continued rise in equity markets. An analysis which has something to reassure the members of the MEB.