World Bank cuts Hungary's GDP growth forecast for 2021

Analysis

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Hungary's GDP is expected to grow by 3.8% in 2021 and to expand by 4.3% in 2022, the World Bank said on Wednesday in its Global Economic Prospects report, according to Hungarian news agency MTI.

The World Bank lowered its forecasted growth rate for Hungarian GDP in 2021 by 0.7 percentage points compared to earlier predictions it made in June 2020.

In 2020 Hungary's GPD is estimated to have fallen by 5.9% according to the organization, which would be a bigger drop by 0.9% percentage points than it earlier said.

The World Bank said that economic activity in Europe and Central Asia (ECA) is estimated to have contracted 2.9% in 2020 in the wake of disruptions related to the COVID-19 pandemic. Economies with strong trade or financial links to the euro area and those heavily dependent on services and tourism have been hardest hit. 

Due to a resurgence of COVID-19, the pace of recovery in 2021 in the region is projected to be slower than originally anticipated, at 3.3%. Growth is then expected to rise to 3.9% in 2022, as the effects of the pandemic gradually wane and the recovery in trade and investment gathers momentum.

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