This year has brought massive uncertainty to economies around the world and to the operations of local, regional, and global businesses. As the world continues to grapple with the COVID-19 pandemic, further downside risks are possible in 2021, but not without some hidden opportunities for businesses.
Our global analyst teams adjusted their research frameworks this year to produce regional outlooks for 2021 that are focused on giving you actionable insights to assist with your strategic planning and critical decisions for next year. Access any of the executive summaries below for specifics on the global drivers impacting each region and what your business can do to mitigate risks and navigate the persistent uncertainty caused by COVID-19.
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- Latin America Regional Outlook for 2021 | Access the executive summary
Like many markets around the globe, Latin America’s economy will rebound in 2021 as the stringency and length of new lockdowns subside. However, businesses should expect the sales rebound that they experienced in the second half of 2020 to wane coming into 2021, as the structural damage of COVID-19 to the region’s economic fabric, jobs, and overall savings levels begins to surface. For economic recovery to be sustained in 2021 and beyond, private investment needs to fill the void of diminishing government stimulus. Governments will need to strike a fiscal spending balance in 2021 to support—or at least not hurt—economic recovery, and to signal fiscal responsibility to creditors and investors.
- Europe, Middle East, & Africa Regional Outlook for 2021 | Access the executive summary
The pace of Europe, the Middle East, and Africa’s (EMEA) recovery in 2021 will depend on governments’ ability to effectively contain COVID-19, reduce social distancing measures, and provide economic support to boost growth. This creates an environment in which businesses are likely to see fluctuations throughout the year, driven by consumer confidence, the spread of COVID-19, and labor market dynamics.
However, we see an upside scenario in which pent-up demand begins to unlock, especially as broader distribution of a vaccine begins, in our assumption, closer to Q2 2021. While the EMEA region will return to pre-COVID economic levels by 2023, companies will find segment and geographic opportunities as soon as 2021 and should invest in spotting and capturing them early. Firms should be systematic in responding to an uncertain and unpredictable operating environment, where factors beyond COVID-19, from political risk to currency volatility and new taxes, will create challenges for companies operating in the region.
- Asia Pacific Regional Outlook for 2021 | Access the executive summary
Although Asia Pacific will continue posting growth rates that are among the world’s highest, secondary outbreaks in major APAC markets along with headwinds from North America and Europe will weigh on the region’s recovery through 2021. Multinationals should plan for muted consumer spending, private investment, and exports across most markets, with some bright spots from public investment and government spending. As executives pursue opportunities in this environment, they should prepare to deal with substantial uncertainty. Headwinds to global growth, continued US-China tensions, and localized outbreaks and lockdowns will continue to create more volatility than the APAC portfolio has seen in decades. To maximize their chances of success, executives and their teams will have to hone the skill sets required to navigate uncertainty, something that is commonplace in more volatile regions but which few in APAC have had to develop over the last 20 years.
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