The IMF forecast Australia’s economy will increase by 6.1 per cent in 2021

News reports are highlighting the negative side of the very recent IMF economic reports, taking account of the current pandemic.

An example being the IMF’s prediction of a 6.7 per cent shrinking of the Australian economy, in 2020.

Headlines like this are showing:

IMF’s dire prediction on Aussie economy for year ahead..
The IMF forecast Australia’s economy would contract by 6.7 per cent in 2020..

But they miss out that the IMF is also predicting a 6.1 per cent recovery in 2021.

This headline is missing:

The IMF forecast Australia’s economy will increase by 6.1 per cent in 2021.

So… the basic news is that the Coronavirus will hurt Australia (and the rest of the world) in 2020, but we will recover the vast majority of the drop in 2021.

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This is much better than most other countries, although it seems that Singapore and Ireland will be slightly ahead of Australia in recovering.

Here is a list of 16 countries that the IMF has also shown results for. Thirteen of them will be worse off than Australia by 2021.

The first figure is the IMF expected GDP drop in 2020, and the second the expected GDP rise in 2021, with the third figure being the important net result. Singapore (position 1) would be down by 0.5%, the Netherlands (position 16) would be down by 4.5%. Australia (position 3) would be down by just 0.6%.

1. Singapore down by 3.5%, then up by 3%, equals down a total of 0.5% by 2021.
2. Ireland down by 6.8%, then up by 6.3%, equals down a total of 0.5% by 2021.
3. Australia down by 6.7%, then up by 6.1%, equals down a total of 0.6% by 2021.
4. United States down by 5.9%, then up by 4.7%, equals down a total of 1.2% by 2021.
5. Germany down by 7%, then up by 5.2%, equals down a total of 1.8% by 2021.
6. Canada down by 6.2%, then up by 4.2%, equals down a total of 2% by 2021.
7. Japan down by 5.2%, then up by 3%, equals down a total of 2.2% by 2021.
8. Switzerland down by 6%, then up by 3.8%, equals down a total of 2.2% by 2021.
9. Belgium down by 6.9%, then up by 4.6%, equals down a total of 2.3% by 2021.
10. UK down by 6.5%, then up by 4%, equals down a total of 2.5% by 2021.
11. Austria down by 7%, then up by 4.5%, equals down a total of 2.5% by 2021.
12. France down by 7.2%, then up by 4.5%, equals down a total of 2.7% by 2021.
13. Portugal down by 8%, then up by 5%, equals down a total of 3% by 2021.
14. Spain down by 8%, then up by 4.3%, equals down a total of 3.7% by 2021.
15. Italy down by 9.1%, then up by 4.8%, equals down a total of 4.3% by 2021.
16. Netherlands down by 7.5%, then up by 3%, equals down a total of 4.5% by 2021.