Euler Hermes warns of continued rising inflation, which in 2021 is expected to reach 2.2% in the euro area and 4.1% in the United States. Although in 2022 experts expect a slowdown in the trend, it will remain upward, and in certain sectors is expected to be significantly higher than average. These include the production of cars, construction materials, as well as retail and logistics and warehousing services.
Analysts of the global leader in commercial credit insurance expect strong growth in the global economy with GDP growth of 5.5% in 2021 and 4.2% in 2022. However, in their latest report, they warn that it will be increasingly uneven, both in different periods and in different countries.
For Bulgaria, the insurer maintains its forecast for GDP growth below the global one – by 3.5% and 3.8% for 2021 and 2022, respectively. For the euro area, the outlook is a 5% increase for 2021 and 4.2% for 2022.
Uncertainty about economic development is linked by experts to several factors. The disruption of supply chains has a very serious impact, which surprised the world in the conditions of unexpectedly fast growth after COVID-19. According to experts, their recovery will not happen until 2023. Additional economic unrest is expected with the gradual or complete disappearance of government policies to support business and people during the COVID-19 crisis. According to the report, the economies of developing countries are still more vulnerable and unable to catch up. The main reason for this, according to Euler Hermes experts, is the delay in vaccination of the population and the smaller resources for flexible policies in support of local economies.
Due to supply difficulties and labor market problems, industries will continue to face difficulties, which will slow down global trade growth to some extent. The updated forecast of Euler Hermes is for an increase of 8% and 6% in volume for 2021 and 2022, respectively. However, the expected growth in value is 16.9% and 8%. According to experts, capital markets are largely immune to the negative effects of unexpectedly rapid growth after the COVID-19 crisis, and therefore expectations there are for stable development next year.
“With this serious dynamic and challenge to make accurate forecasts and plans for business development, risk management is key to the success and even survival of the business. In an environment of ups and downs, there may be surprises even with known and proven over time One of the tools to protect business is commercial credit insurance, but today it is especially important to look for a stable insurance partner. “, explains Kamelia Popova, Euler Hermes Manager for Bulgaria and recalls that Moody’s Investors Service confirmed the stable Aa3 stable rating of Euler Hermes in the latest review of five leading commercial credit insurers in the world. Even in the context of the COVID-19 crisis, the outlook for Euler Hermes remains stable as a reflection of the stable rating of the Allianz group to which it belongs.
– .
