Global Recovery Tracker: Q3 2021

September 2021

Although the performance of many economies globally continues to improve in Q3 2021, the momentum for recovery in 2021 is likely to have peaked due to the spread of the highly infectious Delta coronavirus variant, slowdown in vaccination campaigns in advanced economies and low vaccination rates in developing economies. This series of quarterly reports helps businesses track and predict when activity in key markets will recover in order to plan accordingly.

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Key Findings

Global recovery likely to have peaked

Even as more countries are expected to have recorded a Recovery Index score of 100 and over in Q3 (indicating a recovery to pre-pandemic levels), the momentum of the recovery in 2021 is likely to have peaked due to the spread of the highly contagious Delta coronavirus variant, slowdown in vaccination campaigns in advanced economies and low vaccination rates in developing economies.

China seems to be shifting focus away from stimulating recovery             

In August, the Chinese government announced a series of strict regulations in key sectors related to national security, technology, finance and monopoly power in a move that could in effect dampen investor confidence and adversely impact the business environment.

US recovery peaked as Delta variant spreads

Following a strong recovery in the previous quarter, the US is set to have lost recovery momentum in Q3 2021 due to rising concerns over worsening pandemic outlook, dampening consumer confidence and weakening retail sales.

Germany recovered

Germany is set to have rebounded to pre-pandemic levels in Q3 2021. Germany’s recovery can be attributed to improving consumer sentiment and increasing private consumption, supported by the reopening of the services sector.

New coronavirus variants pose risks to the outlook

The biggest downside risk to the global recovery is the emergence and spread of more contagious and potentially vaccine-resistant coronavirus variants. Consumer sentiments in Europe and the US are already expected to have dampened ahead of the upcoming cold season that can potentially bring a spike in COVID-19 cases.

 

Introduction

Scope
Key findings
Key events so far (1)
Key events so far (2)
Global economic recovery likely to have peaked
Uncertainty continues to decline, but remains significant

Euromonitor Recovery Index

Recovery Index
Global overview for Recovery Index in Q3 2021
Index ranking based on Q3 2021 scores: 1 to 10
Index ranking based on Q3 2021 scores: 11 to 20
Index ranking based on Q3 2021 scores: 21 to 30
Index ranking based on Q3 2021 scores: 31 to 40
Index ranking based on Q3 2021 scores: 41 to 48
Recovery landscape in Q3 2021

Overview of Major Economies

Economies lose recovery momentum amid spread of Delta variant
Economic activity picks up gradually across major economies
Labour market recovery stagnates
Consumer spending recovery lose s traction over case resurgence
Retail sales rebound faces barriers over introduction of certificates
Confidence growth stalls over vaccine shortcomings

Country Insights

Brazil: Accelerating vaccination supports consumption recovery
China: Focus shift from sustaining recovery to dealing with rising risks
Germany: Despite rising fourth wave, full recovery expected
India: Economy set on slow recovery with low vaccination rates
Italy: Rapid recovery from the COVID-19 shocks continues
Japan: Olympic Games lifted consumption in Q3 despite virus wave
US: Recovery seems to have peaked, as Delta variant spreads
UK: Delta variant spread lead to economic uncertainty for Q4

Conclusion

Recovery momentum is likely to have peaked
Key country insights
Outlook

Appendix: Index Methodology

Recovery Index methodology
Recovery Index indicators and weights
COVID-19 global scenario assumptions and definitions
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