Virus cuts G-20 GDP by record 3.4% in first quarter: OECD

[PARIS] Measures to curtail the coronavirus outbreak caused a 3.4 per cent drop in gross domestic product (GDP) for the Group of 20 (G-20) major economies in the first three months of 2020, the largest decline since records began in 1998, the Organization for Economic Cooperation and Development (OECD) said Thursday.

The steepest declines came in China, where the economy shrank 9.8 per cent from the fourth quarter of 2019, and in France and Italy, down 5.3 per cent 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 per cent in the first quarter of 2009, at the height of the financial crisis," the OECD said.

The Paris-based agency had already warned Wednesday that the global economy would contract at least 6 per cent 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 per cent, it said, while warning that in both scenarios, the recovery would be "slow and uncertain".

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

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

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

The only G-20 countries to register GDP growth in the first quarter were India, with 0.7 per cent, and Turkey at 0.6 per cent.

AFP