The World Bank released on January 5, 2021 its “Global Economic Prospects – January 2021” report in which it forecasted world economic growth to improve from an estimated contraction of 4.3% in 2020 to a growth of 4.0% in 2021 following the economic shock that took place in 2020 as a result of the COVID-19 pandemic. The World Bank also expects world growth to average around 3.8% in 2022, constrained by the pandemic’s long-term damage to overall growth, noting that global GDP in 2022 is expected to remain 4.4% below pre-pandemic projections. The report commented that global recovery, which has been limited in the short term by the rebound in COVID-19 cases, is expected to improve over the forecast horizon as confidence, consumption, and trade steadily recover. Delving further into details, the report mentioned that despite the introduction of a number of restrictive measures, COVID-19 is still spreading worldwide, with some areas being experiencing a large increase in infections and a high number of new cases. On a more positive note, the report stated that strong progress has been made in the development of effective vaccines, with several countries beginning to offer inoculations. On the other hand, the report noted that there are several downside risks involved that could hamper global recovery, including a wider spread of the virus, delays in acquiring & distributing the vaccine, and financial stress resulting from high debt levels & weak growth, among others. In this vein, the report stressed on the importance of implementing some urgent policy priorities, namely limiting the spread of the virus and conquer vaccine-related challenges. The report added that in order to address the adverse consequences of the pandemic, it will be crucial to encourage resilience by safeguarding health & education, focus on investments in digital technologies & green infrastructure, enhancing debt transparency, only to name a few. The report also highlighted that global cooperation will be essential to resolve the aforementioned challenges. From another standpoint, the World Bank expected growth in advanced economies to improve from an estimated contraction of 5.4% in 2020 to a growth of 3.3% in 2021 and 3.5% in 2022 (3.2% lower than pre-pandemic projections). The report further unveiled that precautionary social distancing and strict lockdown measures due to the rapid increase in the number of COVID-19 cases have resulted in an unprecedented drop in demand and supply of services in mid-2020. Similarly, the World Bank projected economic growth in Emerging Markets & Developing Economies (EMDEs) to rise from a contraction of 2.6% in 2020 to a growth of 5.0% in 2021, before slowing to 4.2% in 2022 (6% below pre-pandemic projections). According to the World Bank, although all EMDE countries are expected to grow this year, their growth levels vary disproportionately, with EMDE countries that have larger outbreaks of the virus and a bigger reliance on services & tourism expected to grow at a slower pace. On the regional front, the World Bank anticipated the economy of the Middle East & North Africa (MENA) region to have contracted by 5.0% in 2020, with expectations of a growth of 2.1% in 2021 and 3.1% in 2022 (8% below pre-pandemic projections). The World Bank commented that the output in MENA oil exporters has contracted by around 5.7% in 2020 and remains constrained by commitments to the OPEC+ to reduce oil production. On the other hand, oil importers witnessed a smaller contraction of 2.2% in 2020, driven by low COVID-19 spread early in the year and low oil prices. The report noted that since then, the virus has spread rapidly and the number of infections has increased markedly in some countries, prompting households and firms to follow strict lockdown measures which, in turn, have heavily weakened activity around workplaces and retail spaces. On a local basis, the World Bank projected Lebanon’s real GDP to have contracted by 6.7% in 2019, and expects larger economic contractions of 19.2% in 2020 and 13.2% in 2021. The report noted that forecasts beyond the year 2021 for Lebanon were removed due to “a high degree of uncertainty”. According to the World Bank, Lebanon is facing a multitude of challenges, namely the ongoing political & economic crises, the COVID-19 pandemic that is exacerbating the effects of these crises, and the Beirut port explosion, not to mention the country’s default on its sovereign debt for the first time in history, the triple-digit inflation levels, the collapse of the official exchange regime, among others. Furthermore, real growth figures were downwardly revised from those published in the June 2020 issue of the Global Economic Prospects report in which the World Bank had estimated economic contractions of 5.6% for 2019, 10.9% for 2020, and 6.3% for 2021.