After contracting by 4.2% in 2020, GDP is projected to rebound by 3.8% in 2021 and 4.4% in 2022. GDP will return to its pre-pandemic level at the end of 2021. The reopening of the economy will create renewed strength in household demand and business investment, which will replace government spending as the main engine of growth. The economic recovery will be reflected in gradual improvements in the labour market.
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