Virus cuts G20 GDP by record 3.4% in 1st quarter – OECD

PARIS, France – Measures to curtail the coronavirus outbreak caused a 3.4% drop in gross domestic product (GDP) for the Group of 20 major economies in the first 3 months of 2020, the largest decline since records began in 1998, the Organisation for Economic Co-operation and Development (OECD) said on Thursday, June 11.

The steepest declines came in China, where the economy shrank 9.8% from the 4th quarter of 2019, and in France and Italy, down 5.3% each, the OECD said.

These were among the first countries to impose drastic lockdowns against the virus.

“As a comparison, GDP fell only 1.5% in the 1st quarter of 2009, at the height of the financial crisis,” the OECD said.

The Paris-based agency had already warned on Wednesday, June 10, that the global economy would contract at least 6% this year because of business closures and stay-at-home orders to curb the COVID-19 pandemic.

In the event of a second wave of contagion later in the year, economic output could shrink by as much as 7.6%, it said, while warning that in both scenarios, the recovery would be “slow and uncertain.”

In Thursday’s report, the OECD said provisional data showed GDP declines of 2.2% in Germany, 2.1% in Canada, and 2% in Britain.

Output shrank 1.5% in Brazil, 1.3% in the United States and South Korea, and 1.2% in Mexico.

The contraction was less felt in Indonesia with a drop of 0.7%, Japan down 0.6%, and Australia 0.3% lower, said the report.

The only G20 countries to register GDP growth in the 1st quarter were India, with 0.7%, and Turkey at 0.6%. – Rappler.com