The Economy in 2021
As most of the world is still digesting and dealing with the fallout from Covid 19, we are seeing highly encouraging news and results coming from the countries who have made progress in fighting the pandemic, specifically China. They are again enjoying internal travel, public gatherings and are cranking up economic output. It is estimated they will grow their economy by as much as 7% in 2021. If we believe this to be true, we must also think that this is possible also in other countries.
For now, governments and central banks are focused on the short term goals to keep society safe, to keep food on our plates and people in their homes. Once the vaccines are distributed, we should see a slow return to life as we knew it, albeit with masks and a heightened sense of keeping one’s distance in risky situations. Debts will need to be paid and plans for growth and a better future will be crucial.
We will see a lasting change in the way that we work, more time at home than in our offices, more time on video calls and less flying for meetings and we will plan our lives knowing that life is fragile and we must value what is dearest to us. These shifts mean significant changes for real estate, travel industry, media/entertainment, HR and how we use our cities. Geo-politically speaking, Biden and Brexit will bring significant change both domestically and globally as new policies come into effect. Technological developments will continue as AI and other tools bring change to how we work and live.
In the year ahead, we will see continued interest in Bitcoin and cryptocurrencies as investors look for ways to create value and to seek upsides during chaotic times.
Climate change and our response to it is now an economic imperative and requires our direct attention. As with the pandemic, there will be winners and losers – we are working with experts who can help firms think about sustainable investing, becoming carbon neutral and to helping drive through the changes needed to win this battle.