Record economic slumps hit Europe

Coronavirus cases force agonising trade-offs between lives, financial health


AFP July 31, 2020
Shoppers wear face masks on Oxford Street in London after face coverings became mandatory in shops and supermarkets in Britain. PHOTO: AFP

PARIS:

Nation after nation across Europe on Friday unveiled the extent of historic economic devastation as resurgent coronavirus cases forced agonising new trade-offs between lives and financial health.

Six months after the World Health Organisation (WHO) declared a global emergency, the novel coronavirus has infected more than 17 million people and wreaked global economic mayhem.

France’s economy contracted by a record 13.8% in the second quarter, Spain went into recession after its gross domestic product slumped 18.5%, Portugal’s economy contracted 14.1% and Italy’s GDP plunged 12.4%.

Europe as a whole was hammered by its sharpest recorded contraction in the second quarter, with GDP down 12.1% in the euro zone and 11.9% across the bloc.

“It is a shocking drop, but completely understandable as the economy was shut for a considerable period during the quarter,” said Bert Colijn, senior economist at ING Bank.

Airline conglomerate IAG, the owner of British Airways, on Friday posted a first-half net loss of €3.8 billion ($4.5 billion), UK bank NatWest slid into the red while Dutch airline KLM and truck-maker Scania said they were each shedding 5,000 jobs.

Britain on Friday enforced new lockdown rules in Manchester and nearby parts of northern England in an ill-timed announcement on the eve of Eidul Azha.

The United States - the world’s hardest-hit nation and its biggest economy - posted a second-quarter loss of 9.5% compared with the same period a year ago, the worst figure on record.

If that trajectory carried through the entire year, its economy would collapse by nearly a third (32.9%), the data showed.

Historic contractions have been additionally recorded in Germany (10.1%), Belgium (12.2%), Austria (10.7%) and Mexico (17%).

Global daily cases are now approaching the 300,000 mark, with the curve showing no sign of flattening - it took just 100 hours for one million new cases to be recorded.

Vietnam recorded its first coronavirus death on Friday as the pandemic rebounds in a country that had previously been praised for stubbing out the contagion.

Hong Kong said it would delay local elections planned for September because of a virus surge.

In Japan, Tokyo’s governor called for restaurants, bars and karaoke parlours to shut earlier as the capital reported a record number of new infections.

Sweden, whose controversial softer approach to curbing coronavirus has received worldwide attention, said it would encourage people to keep working from home into next year where possible, as the country passed 80,000 recorded cases.

Published in The Express Tribune, August 1st, 2020.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.


COMMENTS

Replying to X

Comments are moderated and generally will be posted if they are on-topic and not abusive.

For more information, please see our Comments FAQ