The EU saw its sharpest drop in GDP for more than a decade as coronavirus lockdowns brought Europe’s economies to a standstill, new data shows. GDP in the eurozone tumbled 3.1% in the first three months of 2020, compared with the same period a year earlier. The EU saw a fall of 2.6% over the same period. There are the biggest drops since 2009, according to Eurostat. The biggest declines in GDP in Europe were in France, Italy, Spain and Slovakia. Meanwhile, just four countries reported positive growth in the first quarter of 2020: Ireland, Bulgaria, Sweden and Romania.
It’s not surprising there’s been variety in the economic outcomes in European countries given the “different timelines and strategies to the lockdown, and more importantly the contagion itself” he added. Employment is also down, in the first decline since 2013, at 0.2% in the euro area, and 0.1% in the EU. Lithuania, Malta and Croatia saw the highest growth of employment, while Spain, Bulgaria, Portugal, Slovakia and Sweden have suffered the biggest drop. It is difficult to give a country-specific explanation for these figures at this point.
The EU has warned it is facing a “historic” downturn, with the prospect of at least a 7.4% contraction this year, significantly worse than the fall in 2009. This could be even worse with a second spike of infections and further economically damaging lockdown measures. How this plays out depends on the shape of the recovery, says Véron.
Source: Euro News
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