Thanks to a very high rate of inoculation and the reopening of the economy since mid-February, GDP is projected to grow robustly by 5% in 2021 and 4.5% in 2022. The removal of supply restrictions, pent-up demand, the withdrawal of some excess savings accumulated in 2020 and a gradually improving labour market all support strong consumption growth. Investment and external demand are set to strengthen as uncertainty fades and vaccinations progress globally, while high-tech services exports will continue to grow robustly.
Monetary and fiscal policy should remain supportive until the labour market situation improves significantly, while adapting to facilitate the reallocation of workers and capital. Stepping up retraining and job-search assistance can help the unemployed transition to new jobs. A fiscal strategy should be prepared and include policies to strengthen the recovery and make growth more inclusive and environmentally sustainable. Measures should include investments in the educational system, skills, public transport and climate-friendly infrastructure.