IBERSOL | Annual Report 2020

ANNUAL REPORT 2020 Global situation The Covid-19 pandemic had a deep impact on economic activity all over the world. According to data from Banco de Portugal, global GDP is expected to decrease 3.5% in 2020. Economic losses varied greatly be- tween countries and sectors. The unprecedented response in terms of budget policy, in both magnitude and timing, albeit different from coun- try to country, was crucial to mitigate the damage caused by the crisis. Following the 9.4% drop in the first semester of 2020, when compared to the final semester of 2019, activity picked up in the third quarter, growing above expectations (7.3% in succession). The reappearance of several Covid-19 cases, especially in developed economies, led to the reintroduction of lockdown measures, conditioning activity in the hard- est hit sectors and in the trust of economic agents. Global trade dropped 9.5%, with forecasts of 7.1% growth in 2021 and 4% in 2022. Recovery will be conditioned by international tourism and transport flows and by a restructuring of global production chains. Economic growth rates of 5.6% and 3.7% are expected for 2021 and 2022, respectively. However, these forecasts are weighed down by un- certainty, given difficulties in the vaccination process at the world, and the need for economic stimulus policies in the more fragile economies. ECONOMIC FRAMEWORK 9