Supervisor Elham AbolFateh
Editor in Chief Mohamed Wadie

OECD: Omicron Variant Could Cause Global Slowdown


Wed 01 Dec 2021 | 07:53 PM
Taarek Refaat

A leading economic think tank has warned that Western governments could be forced to provide new emergency financial support to businesses and households if the coronavirus or micron variant causes a sharp global slowdown.

The alarm has sounded as more cases are identified, the Organization for Economic Co-operation and Development (OECD) said a renewed wave in the pandemic threatens to add to the current pressure on the global economy from persistently high levels of inflation.

The Paris-based organization said that if Omicron proves to be more transmissible than other variants or more resistant to current vaccines, it could exacerbate disruption to already fractured supply chains and risk prolonged inflation.

If it takes a more agressive turn, it may also force governments to impose stricter restrictions on movement, which hurt demand for goods and services, and lead to a sharp decline in economic activity and low inflation, similar to the first phase of the pandemic.

The organization, which published its latest Economic Outlook, said the world's recovery from previous lockdowns was continuing, but that momentum had waned and had become increasingly unbalanced.

It added that failure to ensure rapid and effective vaccination worldwide has been costly, with uncertainty remaining high as new variants of Covid are identified.