The outlook for the global economy is improving despite a second wave of coronavirus outbreaks in many countries as vaccines emerge and a Chinese-led recovery takes hold, the OECD said today. 

The global economy will grow 4.2% next year and ease to 3.7% in 2022, after shrinking 4.2% this year, the Organisation for Economic Cooperation and Development said in its latest Economic Outlook. 

After a second wave of infections hit Europe and the US the Paris-based policy forum trimmed its forecasts from September, when it expected a global contraction of 4.5% before a 5% recovery in 2021. 

It did not have a 2022 forecast at the time. 

"We're not out of the woods. We're still in the midst of a pandemic crisis, which means that policy still has a lot to do," said OECD chief economist Laurence Boone. 

Overall global gross domestic product will return to pre-crisis levels by the end of 2021, led by a strong recovery in China, the OECD said. 

But that masked wide variations among countries, with output in many economies expected to remain about 5% below pre-crisis levels in 2022. 

China will be the only country covered by the OECD to see any growth at all this year, at 1.8%, unchanged from the last forecast in September. It will gain speed to 8% in 2021 - also unchanged - before easing to 4.9% in 2022. 

The US and Europe are expected to contribute less to the recovery than their weight in the global economy. 

After contracting by 3.7% this year, the US economy will grow 3.2% in 2021 and 3.5% in 2022, assuming a new fiscal stimulus is agreed.

 In September, the OECD had forecast a contraction of 3.8% this year and a rebound of 4% next year. 

The euro area economy will contract 7.5% this year, with many economies finishing the year in a double-dip recession after re-imposing lockdowns. Its economy will see growth return in 2021 at 3.6% and 3.3% in 2022. 

Though hard hit, the forecasts were an improvement from September, which had foreseen a contraction of 7.9% this year and a 5.1% rebound in 2021.