On Monday 31 May the Organisation for Economic Co-operation and Development (OECD) revised its economic forecasts upwards for the Euro area in 2021 and 2022.
After a recession of -6.6% of GDP in 2020, wealth creation in the 19 Euro area countries is expected to rise to 4.3% in 2021 and 4.4% in 2022. For the four largest economies in the euro area, growth is expected to be 5.9% of GDP in Spain (6.3% in 2022), 5.7% in France (4.0%), 4.5% in Italy (4.4%) and 3.3% in Germany (4.4%).
In its spring economic forecasts, the European Commission expects a similar recovery in the euro area (see EUROPE 12719/2).
Public health strategies, the speed of vaccine campaigns and fiscal and monetary stimulus packages, as well as the relative importance of hard-hit sectors such as tourism all play a role in explaining the disparities in the recovery of economic activity worldwide, the OECD says. It adds that in Korea and the US, incomes have already returned to pre-pandemic levels, while in much of Europe it will take another year to do so.
See the OECD economic forecasts: https://bit.ly/3vHZDxK
Taxation. Asked about the ongoing OECD negotiations on international tax reform, the organisation’s outgoing Secretary-General Ángel Gurría said that a final agreement could be reached by the time of the G20 summit in Rome on 30-31 October.
While the sequence of these negotiations goes through the G7 Finance meeting in London at the end of the week, the Franco-German tandem is putting pressure on for an agreement to be possible as early as the G20 Finance meeting in Venice on 9 and 10 July (see EUROPE 12727/23).
Former Australian Finance Minister Mathias Cormann will take over from Mr Gurría on 1 June. (Original version in French by Mathieu Bion)