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EU economy will not be able to return to pre-pandemic level before mid-2022 - Lagarde

Europe / Business and Finance

Europe is likely to face the third wave of the coronavirus pandemic, which will be almost useless to fight with quarantine measures.

EU economy will not be able to return to pre-pandemic level before mid-2022 - Lagarde

The recovery of the European economy after the recession caused by the COVID-19 pandemic will begin no earlier than the second half of the year, the President of the European Central Bank Christine Lagarde said in comments to French reporters.

As eurozone countries lock down their economies to slow the spread of the new strain of coronavirus, the EU economy contracted in the last quarter and is likely to continue to contract in the first three months of 2021 as much of the service sector remains closed.

“We expect the recovery to pick up momentum around mid-year, even if uncertainty persists,” Lagarde said in an interview with Le Journal du Dimanche. “Let's be clear: we will not see a return to pre-pandemic levels of economic activity before mid-2022.”

Lagarde called on the political leadership of Europe to finally ratify the unprecedented € 750 billion ($ 903 billion) recovery fund.

“The plan needs to be ratified in time so that the European Commission can borrow as planned next June and then disburse the funds,” she said.

According to the latest models of the development of the pandemic, the rapid spread of a new strain of coronavirus could trigger a third wave of the epidemic in Europe and elsewhere in the world. The British version of COVID-19 is 1.55-1.7 times more infectious than the "usual" spring viruses. That is, standard measures that limit the number of contacts between people may not be enough to combat its spread.

Today, more than 104 million people are infected with coronavirus in the world, almost 2.3 million have died. Most infected and victims are in the USA, India and Brazil.

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