What started as a novel virus in China quickly became a sweeping disease that shut down the world and put a 1.5 year halt on the global economy.
But while some countries’ economies are already back to normal, others are lagging far behind.
COVID-19 Recovery Timelines, by OECD Country
This chart using data from the OECD anticipates when countries will economically recover from the global pandemic, based on getting back to pre-pandemic levels of GDP per capita.
Note: The categorization of ‘advanced’ or ‘emerging’ economy was determined by OECD standards.
The Leaders of the Pack
At the top, China and the U.S. are recovering at breakneck speed. In fact, recovering is the wrong word for China, as they reached pre-pandemic GDP per capita levels just after Q2’2020.
On the other end, some countries are looking at years—not months—when it comes to their recovery date. Saudi Arabia isn’t expected to recover until after Q1’2024, and Argentina is estimated to have an even slower recovery, occurring only after Q2’2026.
|🇧🇪 Belgium||After Q4 2022||Advanced|
|🇸🇪 Sweden||After Q4 2021||Advanced|
|🇸🇰 Slovakia||After Q4 2021||Advanced|
|🇳🇿 New Zealand||After Q4 2021||Advanced|
|🇩🇪 Germany||After Q4 2021||Advanced|
|🇪🇪 Estonia||After Q4 2021||Advanced|
|🇩🇰 Denmark||After Q4 2021||Advanced|
|🇮🇸 Iceland||After Q3 2023||Advanced|
|🇸🇮 Slovenia||After Q3 2022||Advanced|
|🇵🇹 Portugal||After Q3 2022||Advanced|
|🇫🇷 France||After Q3 2022||Advanced|
|🇦🇹 Austria||After Q3 2022||Advanced|
|🇵🇱 Poland||After Q3 2021||Advanced|
|🇳🇴 Norway||After Q3 2021||Advanced|
|🇱🇺 Luxembourg||After Q3 2021||Advanced|
|🇱🇻 Latvia||After Q3 2021||Advanced|
|🇯🇵 Japan||After Q3 2021||Advanced|
|🇫🇮 Finland||After Q3 2021||Advanced|
|🇪🇸 Spain||After Q2 2023||Advanced|
|🇬🇧 United Kingdom||After Q2 2022||Advanced|
|🇳🇱 Netherlands||After Q2 2022||Advanced|
|🇮🇹 Italy||After Q2 2022||Advanced|
|🇬🇷 Greece||After Q2 2022||Advanced|
|🇨🇿 Czech Republic||After Q2 2022||Advanced|
|🇨🇦 Canada||After Q2 2022||Advanced|
|🇺🇸 United States||After Q2 2021||Advanced|
|🇰🇷 South Korea||After Q2 2021||Advanced|
|🇮🇪 Ireland||After Q2 2021||Advanced|
|🇨🇭 Switzerland||After Q1 2022||Advanced|
|🇮🇱 Israel||After Q1 2022||Advanced|
|🇭🇺 Hungary||After Q1 2022||Advanced|
|🇦🇺 Australia||After Q1 2022||Advanced|
|🇱🇹 Lithuania||After Q1 2021||Advanced|
|🇿🇦 South Africa||After Q4 2022||Emerging|
|🇮🇩 Indonesia||After Q4 2021||Emerging|
|🇮🇳 India||After Q4 2021||Emerging|
|🇲🇽 Mexico||After Q3 2023||Emerging|
|🇨🇴 Colombia||After Q3 2022||Emerging|
|🇧🇷 Brazil||After Q3 2022||Emerging|
|🇨🇱 Chile||After Q3 2021||Emerging|
|🇹🇷 Turkey||After Q3 2020||Emerging|
|🇦🇷 Argentina||After Q2 2026||Emerging|
|🇨🇷 Costa Rica||After Q2 2023||Emerging|
|🇷🇺 Russia||After Q2 2021||Emerging|
|🇨🇳 China||After Q2 2020||Emerging|
|🇸🇦 Saudi Arabia||After Q1 2024||Emerging|
Most countries will hit pre-pandemic levels of GDP per capita by the end of 2022. The slowest recovering advanced economies—Iceland and Spain—aren’t expected to bounce back until 2023.
Four emerging economies are speeding ahead, and are predicted to get back on their feet by the end of this year or slightly later (if they haven’t already):
- 🇷🇺 Russia: after Q2’2021
- 🇨🇱 Chile: after Q3’2021
- 🇮🇳 India: after Q4’2021
- 🇮🇩 Indonesia: after Q4’2021
However, no recovery is guaranteed, and many countries will continue face setbacks as waves of COVID-19 variants hit—India, for example, was battling its biggest wave as recently as May 2021.
Why are some countries recovering faster than others? One factor seems to be vaccination rates.
|Country||Doses Administered per 100 People||Total Doses Administered||Percent of Population Fully Vaccinated|
|🇬🇧 United Kingdom||122||81,438,892||53%|
|Trinidad and Tobago||27||375,924||11%|
|Saint Vincent and the Grenadines||23||25,509||–|
|West Bank & Gaza||20||958,519||9%|
|São Tomé and Príncipe||18||37,716||5%|
|Bosnia and Herzegovina||14||470,218||5%|
|Republic of the Congo||3||163,742||–|
|Central African Republic||1.7||78,685||–|
|Papua New Guinea||0.6||51,170||<0.1%|
As of July 16th, 2021.
The higher the rate of vaccination, the harder it is for COVID-19 to spread. This gives countries a chance to loosen restrictions, let people get back to work and regular life, and fuel the economy. Additionally, the quicker vaccines are rolled out, the less time there is for variants to mutate.
Another factor is the overall strength of a country’s healthcare infrastructure. More advanced economies often have more ICU capacity, more efficient dissemination of public health information, and, simply, more hospital staff. These traits help better handle the pandemic, with reduced cases, less restrictions, and a speedy recovery.
Finally, the level of government support and fiscal stimulus injected into different economies has determined how swiftly they’ve recovered. Similar to the disparity in vaccine rollouts, there was a significant fiscal stimulus gap, especially during the heat of the pandemic.
Recovering to Normal?
Many experts and government leaders are now advocating for funneling more money into healthcare infrastructure and disease research preventatively. The increased funding now would help stop worldwide shut downs and needless loss of life in future.
Time will tell when we return to “normal” everywhere, however, normal will likely never be the same. Many impacts of the global pandemic will stay with us over the long term.
Here’s How Reserve Currencies Have Evolved Over 120 Years
Today, the U.S. dollar makes up 60% of held reserve currency. See how global preferences have shifted since 1900.
Here’s How Reserve Currencies Have Evolved Over 120 Years
Over the last 120 years, the popularity of different reserve currencies have ebbed and flowed, reflecting the shifting fortunes of leading global economies.
For example, in the year 1900, the U.S. dollar and pound sterling made up 0% and 62% of global reserves respectively. But fast forward to 2020, and the pound now represents just 4.7% of global currency reserves, while the U.S. dollar stands at nearly 60%.
Today’s motion graphic from James Eagle looks at the year-over-year change in currency reserves as a portion of total reserves, spread across 120 years.
What is a Reserve Currency?
A reserve currency is a large quantity of currency held in “reserve” by monetary authorities like central banks.
Currencies are often held in reserve in preparation for investments and transactions, among other things. Our vast global trade system, which is approaching $20 trillion in value, means plenty of currencies are always needed in reserve. In fact, an estimated $5 trillion in currency swaps hands every single day.
Here are some reasons that currency reserves are held:
- Exchange rate stability for the domestic currency
- To ensures liquidity in times of crisis
- To diversify central bank portfolios, which can reduce risk and improve credit ratings
- More than 65 countries peg their currencies to the U.S. dollar
- Five U.S. territories and a number of sovereign countries, such as Ecuador and Panama, use it as an official currency of exchange
- Around 90% of all Forex trading involves the U.S. dollar
All things equal, countries benefit economically from greater demand for their respective currencies.
The Rise and Fall of Reserve Currencies
Some economists argue that the demand for currencies in the long run revolves around the economic relevance of a country. In general, the larger and more powerful a nation’s economy is, the greater the network effect, and the more interlinked they are to the global economy. Thus, the greater demand there is to hold their currency in reserve.
The last 120 years of currency reserve data shows some support for this claim. For example, Japan’s economy hit a peak in terms of its relative share of global GDP in the early 1990s, just before the effects of the Lost Decade were felt. Subsequently, their peak as a reserve currency was around the same horizon, at 9.4% in 1990.
America’s Era of Dominance
Due to the economic strength of the United States in the post-WWII era, the dollar is what economists call a vehicle currency.
This means many non-dollar economies still choose to engage in international transactions using the dollar. These smaller and less accepted currencies are often converted to U.S. dollars before proceeding with any business or trade dealings. This is why, although Asian economies tend to have neighboring states as their top trade partners, they still engage in a massive portion of these transactions with the U.S. greenback as the currency of choice.
Here are some facts that further exemplify the strength and power of the U.S. dollar:
Additionally, the dollar is often seen as a haven in times of extreme uncertainty and tumult. Given its status as the world’s reserve currency, it can be perceived as less risky and can withstand economic shock to a greater degree relative to other currencies.
New Challengers to the Dollar
In the not too distant past, the U.S. displaced the UK economically and as the world’s reserve currency. Today, the U.S. economy is showing signs of slowing down, based on GDP growth.
China is on the rise, having already displaced the U.S. as the EU’s top trade partner. With projections for China to overtake the U.S. as the world’s largest economy before 2030 in nominal terms, could a new global reserve currency emerge?
The World Population Pyramid (1950-2100)
The world is in the midst of a notable demographic transition. Here’s how the world population pyramid will change as we close in on the year 2100.
The world is in the midst of a notable period of demographic transition.
Back in the 1960s, global population growth peaked at a 2.1% annual rate, but since then it has been on a historic downtrend.
In fact, according to the most commonly cited United Nations projection, which is based on a medium fertility rate scenario, it’s expected that annual population growth could drop all the way to 0.1% by the end of the 21st century.
Visualizing a Demographic Transition
Today’s powerful charts come from Our World in Data by economist Max Roser, and they show how global demographics will shift over the next 80 years.
Below you can see one major catalyst of this change, which is the peaking (and then falling) population growth rate:
Why has population growth been dropping since the 1960s?
A variety of explanations factor into this, including:
- Falling fertility rates:
Birth rates tend to fall as nations get richer. First, this happened in the developed world, but as the century progresses this phenomenon will impact more and more developing nations.
- Government policy:
China’s “One Child Policy” in particular had an effect on global population growth, and the aftermath of the policy is still contributing to a shrinking Chinese population over the long term.
- Rural flight
Urban dwellers tend to have fewer babies—and by 2050, there will be an additional 2.5 billion people living in cities globally.
Fewer births combined with improving healthcare—especially in developing nations—will dramatically alter the composition of the world population pyramid, creating both economic opportunities and challenges in the process.
The Changing World Population Pyramid
The following graphic charts how these changes affect the makeup of the world’s population.
Over time, the shape of the world population pyramid is expected to shift from Stage 1 (high birth rates, high death rates) to something closer to Stage 4 (low birth rates, low death rates).
As the population distribution skews older, here is how population size and global median age will change:
|Year||Global Population Size||Median Age|
|1950||2.6 billion||23.6 years|
|2018||7.6 billion||30.0 years|
|2050p||9.7 billion||36.1 years|
|2075p||10.7 billion||39.0 years|
|2100p||11.2 billion||41.6 years|
Global median age is projected to surpass 40 years by the end of the century, and it will be considerably higher in many Western nations, especially in Japan and Europe.
With the future demographic composition looking very different than today, it will be fascinating to see how the economy responds to these potential tailwinds. Further, it will be even more interesting to see what role automation will play as the old-age dependency ratio hits historic highs.
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