The war in Ukraine is a major humanitarian crisis with associated economic shocks that threaten the post‑pandemic recovery. The latest OECD Economic Outlook highlights the implications and risks for growth, inflation and living standards from higher commodity prices and potential disruptions to energy and food supplies, and discusses the associated policy challenges.
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The UK economy recovered from the COVID-19 shock thanks to emergency support measures protecting jobs and incomes and a rapid vaccine rollout, but is slowing amid persisting supply shortages and rising inﬂation. Fiscal policy has to balance gradual tightening with providing well-targeted temporary support to households who are vulnerable to rising costs of living, supporting growth and addressing signiﬁcant investment needs.
© Ian Woolcock/Shutterstock.comUnited Kingdom Economic Snapshot
Slovenia’s strong post-pandemic recovery has been hit by strong headwinds from the war in Ukraine, higher energy prices, and supply chain bottlenecks. At the same time, the strong labour market performance has led to historically high employment, low unemployment and widespread labour shortages. Thus, inﬂation will remain high as growth slows.
© Marcin Jucha/Shutterstock.comSlovenia Economic Snapshot
Since its independence, Estonia has made tremendous progress towards greater economic prosperity. Estonia enjoys solid institutions, political stability, a strong and credible ﬁscal policy, as well as a robust ﬁnancial sector. Estonia is also a frontrunner in digital governance and innovation. Stable and secure digital services are in fact one of the factors that have allowed Estonia to cushion better than others the sanitary and economic shock from the pandemic.
© Oleksiy Mark/Shutterstock.comEstonia Economic Snapshot
Belgium’s recovery from the COVID-19 pandemic has been robust thanks to extensive policy support. However, the new shock from the war in Ukraine is exacerbating inﬂation, and supply and labour market shortages, highlighting the importance of boosting the resilience of the Belgian economy.
© FrimuFilms/Shutterstock.comBelgium Economic Snapshot