Economic growth is projected to rebound and reach 3.5% in 2021 and 4.6% in 2022. New pandemic-related restrictions in early 2021 have delayed the recovery, but growth will pick up in the second half of 2021 as vaccination progresses. Lower uncertainty and favourable financing conditions will encourage private investment, while EU funds will support public investment. After increasing temporarily in 2020 thanks to crisis-related bonuses, wages and incomes are expected to grow at a slower pace.
Expansionary fiscal and monetary policies are continuing to support growth in 2021. Policy support should be removed only when the recovery is firmly underway. The focus on health and long-term care, environmental and digital infrastructure in the EU‑funded recovery plan will help support greener and more inclusive growth. Active labour market policies need to go along with investment plans to avoid leaving hard‑to‑employ job seekers behind. Accelerating privatisations would facilitate the effective reallocation of resources.