City of Surrey's 2021 - 2025 Financial Plan

ECONOMIC OVERVIEW

INTERNATIONAL As at the time of publishing this document, COVID-19 has infected more than 147 million people and claimed more than 3.1 million lives worldwide with a continual rise in these numbers on a daily basis. The United States, Brazil and India were hit the hardest, accounting for more than 43% of infections and 37% of deaths reported to date. The approval of multiple COVID-19 vaccines has brought renewed hope that there will soon be a turnaround in the pandemic. The world economy remained resilient throughout the pandemic due to unprecedented monetary and fiscal support provided by central banks and all levels of government. The International Monetary Fund (“IMF”) estimated that global economic activity contracted by 3.5% last year. Government, corporate and household debt rose by $24 trillion USD last year, bringing global debt to an all-time high of $281 trillion USD. The Institute of International Finance estimates government debt will further increase by $10 trillion USD this year, pushing the global government debt load to $92 trillion USD. The IMF is forecasting the global economy to grow at a rate of 5.5% in 2021. Advanced and emerging economies are forecasted to expand by 4.3% and 6.3%, respectively. The IMF’s expectations see the United States’ (“US”) economy advancing by 5.1%, the United Kingdom’s (“UK”) expanding at 4.5%, and the Eurozone and Canada following behind at 4.2% and 3.6%, respectively. China’s economy is forecasted to grow by 8.1% this year. The pace of recovery across countries will be uneven due to unequal distribution of vaccines. The World Health Organization (“WHO”) is reporting large inequities in vaccine distribution. Of all the vaccines administered to date, low-income countries accounted for 0.1% of usage while high-income countries, representing 16% of the world’s population, had accounted for 50% of usage. There are considerable uncertainties surrounding the path of the pandemic as new, more transmissible variants of COVID-19 are spreading around the world. Nations are in a race to roll out vaccination plans to contain the spread of the virus. As the end of April 2021, 3.1% of the world’s population had been fully vaccinated with 7.1% receiving at least one dose. Throughout the pandemic, trade protectionism has been a recurring theme as countries vie to secure scarce resources. As the demand for vaccine is outpacing supply, countries have been placing restrictions on exports to allow for domestic consumption first. The availability of vaccines to developing countries is a matter of international concern as a return to normality will require a majority of the global population to be immunized. To bridge the inequities in vaccine distribution, the WHO and Switzerland based GAVI, the Vaccine Alliance have come together with other organizations to form the COVID-19 Vaccines Global Access (“COVAX”) program aimed to provide vaccines to low and middle-income countries. Due to vaccine nationalism, where countries raced to vaccinate their own populations as quickly as possible, it is estimated that only one-fifth of low-income nations’ populations will be vaccinated by the end of this year.

City of Surrey | 2021—2025 Financial Plan | Financial Overview

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