With the third COVID-19 wave and the associated containment measures receding, economic growth is projected to increase to 2.6% in 2021 and 2.7% in 2022, led by consumption and exports. Business investment should strengthen in 2022 as uncertainty abates. Output will regain the pre-pandemic level by late 2021 and employment by mid-2022. The main risk to the outlook is that further virus waves could delay the recovery.
The pandemic laid bare pre-existing gaps in social safety net coverage. Improving the design and efficiency of unemployment benefits and more generally of public services in health, social care and childcare would boost growth and make it more resilient.
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2021 Structural Reform Priorities