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Global Recovery Tracker: Omicron Is the New Downward Risk to the Recovery

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In Q4 2021, out of the 48 economies covered by Euromonitor International’s Recovery Index, 28 are expected to have recorded a score of 100 or over, indicating a recovery in which economic output, the labour market and consumer spending all return to/exceed pre-pandemic levels of 2019. From a different perspective, the Recovery Index scores are expected to have deteriorated in 25 out of the 48 economies in Q4 2021 compared to the previous quarter. Countries in the Eurozone and North America, have re-imposed containment measures amid rapid spread of the highly infectious Omicron variant of COVID-19.

Global Overview for Recovery Index in Q4 2021imagesw7d.pngSource: Euromonitor International’s Recovery Index

Recovery landscape in key economies

  • Brazil is expected to be the worst performer on the Recovery Index as its score in Q4 2021 is estimated to have contracted to 91.4 (from 92.0 in the previous quarter). Rising prices and declining retail sales have curbed the country’s recovery.
  • In Q4 2021, the Recovery Index score for China is expected to have reached 107.6 up from 105.1 the previous quarter. With the Chinese economy being the first to fully recover, the government appears to have shifted its focus from stimulating recovery to controlling financial system risks and robust credit expansion. China’s economic boom is expected to see setbacks due to its strict zero-COVID-19 policy, energy supply shortages, and real estate problems.
  • Germany is estimated to reach the Recovery Index score of 102.8 in Q4 2021, down from 103.2 in the previous quarter, given spiking COVID-19 infection rates as the new Omicron variant spreads. The government is considering new restrictions, particularly for the unvaccinated population, with the aim of controlling the spread of the virus.
  • The Recovery Index score in India is expected to have improved marginally to 94.9 in Q4 2021, up from 94.3 in Q3. The country’s outlook has been revised upwards due to rising vaccination rates, higher government spending and the release of pent-up demand, benefiting India’s manufactured goods and services, domestically and internationally.
  • Italy’s Recovery Index is expected to reach 105.0 in Q4 2021, marginally down from 106.5 in Q3, driven by a small decrease in consumer confidence. The economic outlook and the number of incoming tourists is expected to have declined in Q4 2021 as the country tightened entry restrictions due to the spread of the Omicron variant.
  • The Recovery Index score for Japan is estimated to be 93.8 in Q4 2021, up from 91.9 in the previous quarter, mainly due to improving consumer sentiment and consumer expenditure as COVID-19 cases remain low. In Q4 2021, Japanese inflation figures are expected to reach a 20-month high as the global inflation picks up due to supply shortages. However, higher inflation developments are welcome in the country as it battles a two decade-long deflationary trend.
  • The UK’s Recovery Index is expected to have declined to 97.7 in Q4 2021 from 100.1 in the previous quarter. Consumer confidence is dampened by accelerating inflation due to supply shortages, the Bank of England having to raise interest rates to combat this, and the country being one of the first Omicron hotspots. Beneath all of this, the Brexit effects are still present, which is also stoking inflation.
  • The US Recovery Index score is forecast to have improved to 101.0 in Q4 2021, from 98.2 in Q3, despite concerns over a worsening pandemic outlook with the new variant dampening consumer confidence.


Out of the 48 countries covered by Euromonitor International’s Recovery Index, 20 countries are not expected to see their economies rebound to 2019 levels in Q4 2021.

Over the previous quarters, it was noted that the spread of new, potentially vaccine-resistant, and more contagious variants of COVID-19 was one of the greatest risks to the global recovery. As the end of 2021 approaches, almost two years into the COVID-19 pandemic, the emergence and rapid spread of the Omicron variant has increased uncertainty and weakened the momentum of the recovery, if not threatening to derail altogether a rebound in economic and consumer activity in many countries. Low vaccination rates in developing economies, vaccine scepticism in some developed countries, and continued global vaccine shortages as richer countries now race to deliver booster jabs are factors that are prolonging the pandemic.

In addition to risks and uncertainties relating to the new Omicron variant, high inflation and supply disruptions in advanced economies and some emerging market economies are persisting and hurting retail sales and consumer spending, placing a further drag on the recovery.

Euromonitor Recovery Index

Euromonitor’s Recovery Index is a composite index which provides a quick overview of economic and consumer activity and helps businesses predict recovery in consumer demand in 48 major economies. The index takes into consideration total GDP and factors that determine consumer demand – economic activity, employment, consumer spend, retail sales, and consumer confidence. Index scores measure the change relative to the average per quarter for 2019. A score of 100 and over indicates a full recovery in which economic output, labour market, and consumer spending all return to/exceed 2019 levels.


For further insight, please contact An Hodgson

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