Business this week

Business this week

The IMF said that it now thinks the world economy shrank by 3.3% last year, less than it had feared, mainly because of the huge stimulus packages that propped up many economies and without which the contraction may have been three times as great. It increased its forecast for growth this year to 6%, as rich countries rebound from the pandemic with “smaller scars” than from the financial crisis of 2007-09. But the IMF warned that poorer countries, especially those that rely on informal work and tourism, will take longer to recover, leading to rising global inequality.The new infrastructure spending plan unveiled by Joe Biden will fuel the American economy. Among the many commitments are $621bn on transport—such as roads, bridges, public transport, but also electric cars—$400bn for care homes and $100m for modernising the electric grid. Mr Biden's plan faces a rockier road through Congress than the $1.9trn covid-relief package, as even some Democrats are questioning the additional burden on the national debt.The White House wants to pay for all its extra spending mostly through higher corporate taxes, which it hopes will raise $2.5trn in revenue over 15 years. It will raise the domestic rate of tax and increase