The Global economy is expected to expand by 4% in 2021 despite delays in COVID-19 vaccines distribution, while Sub-Saharan Africa GDP is expected to close the year at 3.1%.
Governments and central banks are likely to maintain stimulus packages and different monetary and fiscal policy measures which include reducing interest rates and purchasing assets to inject liquidity into the financial system. Debt is expected to keep rising for most countries.
The United States has assumed a dovish monetary stance and quantitative easing measures to recuperate from the economic slump, which is likely to maintain pressure on the USD. Consequently, Emerging-market currencies are potentially set for their best year since 2017, boosted by a sliding dollar and the prospect of a global recovery in 2021, propelled by COVID-19 vaccine rollouts and more economic stimulus.
Looking at Biden’s foreign policy; trade and foreign relations with historic allies are likely to improve. However, we do not expect U.S-China relation to significantly change as the issue of national security is bipartisan.
After the Brexit vote, currency markets were in turmoil with the euro falling 2% while the pound fell 8%. Brexit also dampened business growth for international companies that were domiciled in the United Kingdom and used the U.K. as the gateway to free trade with the EU nations. However, we see an opportunity for improved trading relations within the Commonwealth going forward.
There are a number of African elections set for this year, hopefully some may settle long time conflicts in countries like Libya and Ethiopia. However we do anticipate short term violence will disrupt processes going on historical trends.