No longer as pessimistic as before, the Organization for Economic Cooperation and Development (OECD) said global gross domestic product will plunge by 4.5 percent this year. In June, it had previously estimated a six percent contraction.
The "recovery" will still be marked by negative growth rates but not as large as before. OECD also warned of "considerable differences" in economic recovery across different countries. The recovery, however, is weakening.
"Output picked up swiftly following the easing of confinement measures and the initial re-opening of businesses, but the pace of the global recovery has lost some momentum over the summer months," said the OECD.
Leading the hesitant comeback will be China, the United States and the 19 member states comprising the eurozone. These countries are expected to do better than the OECD originally forecast in June.
China should see its GDP improve by 1.8% this year -- the only country in the OECD estimated to see growth at all. On the other hand, the U.S. economy is set to shrink by 3.8% while the eurozone is in for a larger 7.9% contraction.
Estimates for the rest of the world are mostly dire. OECD predicts worse economic outcomes for Argentina, India, Mexico, South Africa and the United Kingdom, whose economic growth is forecast to collapse by more than 10 percent.
"The drop in global output in 2020 is smaller than expected, though still unprecedented in recent history," according to the OECD.
Hard-hit sectors such as the travel and tourism have not fully recovered from the strict lockdown measures in many countries imposed earlier this year. Many countries are now frantically grappling with a resurgence in the number of infections. The oncoming fall and winter seasons, along with seasonal influenza, will complicate any recovery from the COVID-19 pandemic this year.
Strong growth, however, is on the horizon as long as inroads can be made against COVID-19. OECD expects the global economy to grow by five percent in 2021. The global outlook, however, "remains exceptionally uncertain" due to the raging COVID-19 pandemic.
Back in June, OECD said the pandemic remains on track to cause the worst economic recession outside of wartime in 100 years. It also predicted unemployment in the median OECD economy this year is projected to be at the highest level in 25 years, and will ease only slowly in 2021.
Founded in 1961, the OECD with its 37 member states seeks to stimulate economic progress and world trade. It's a forum of countries committed to democracy and the market economy.