New York Times title: The economic hit from the virus has been more than four times worse than the financial crisis
By: Liz Alderman
Date: 15 September 2020
“The damage to the world’s major economies from coronavirus lockdowns has been more than four times more severe than the 2009 global financial crisis, and created an “unprecedented” blow to growth in the second quarter in almost every country except China, where the virus was first detected, the Organization for Economic Cooperation and Development said Monday.
Growth in the nations represented by the Group of 20 — an organization of 19 countries and the European Union, representing 80 percent of the world’s economic production — fell by a record 6.9 percent from April to June from the previous three months, as governments kept people indoors and froze business activity. The drop eclipsed a 1.9 percent contraction recorded in the same period in 2009, when the financial crisis was at a peak, the organization said.
China, where lockdowns ended earlier than in the rest of the world, was the only economy to bounce back, expanding at an 11.5 percent rate.
Growth figures have been published by national governments, but the organization’s tally puts the magnitude of the damage into a global perspective. The biggest growth declines were in India (minus 25.2 percent) and Britain (minus 20.4 percent).
Growth in the United States shrank by more than 9 percent, and it contracted by nearly 15 percent in the euro area. By contrast, China, South Korea and Russia appeared to be the least negatively affected.
The global economy will fare far worse should a second wave of infections lead governments to renew wide-scale quarantines, the organization has warned. Without new shutdowns, global growth could shrink by around 6 percent this year, wiping out five years of income growth.
A second wave of infections leading to new lockdowns could cause unemployment around the world — already badly hit by this year’s lockdowns — to double and not recover for at least another year, according to the organization’s forecasts.”
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