After a rebound of 4.2% in 2021, growth is expected to weaken to 2½ per cent in 2022 and 2¼ per cent in 2023 and be accompanied by a surge in inflation mainly because of the war in Ukraine. Soaring energy and food prices, growing uncertainty and supply difficulties for certain raw materials will weigh on activity and only be partly offset by the expected increase in public investment and the measures taken by the government to protect households from rising prices.
The pandemic risks interrupting impressive income convergence and raises the urgency of making growth more inclusive. Addressing long-standing patchy coverage of social benefits and improving provision and efficiency of education and training should become top policy priorities in the recovery.
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2021 Structural Reform Priorities