Coronavirus: British economy slumps 20% in April

Text by: RFI Follow

The United Kingdom suffered a 20.4% plunge in gross domestic product (GDP) in April, the first full month of containment in the face of the pandemic, the National Bureau of Statistics (ONS) announced Friday .

Publicity

A record fall. This collapse comes after a plunge in GDP of 5.8% in March, specifies the ONS. The containment began on March 23 and put an abrupt halt to economic activity in the country which is the second most bereaved in the world with more than 41,000 deaths tested positive for coronavirus.

The restrictions are now gradually being lifted . All shops, except pubs and restaurants, will reopen their doors from Monday.

"  The decline in GDP in April is the strongest ever seen in the United Kingdom, more than three times stronger than the previous month and almost ten times more than the sharpest decline before Covid-19,  " said Jonathan Athow , statistician at the ONS.

Fall in activity and soaring unemployment

All major sectors of the economy have melted, whether services, industry or construction. Pubs, education, health and car sales were among the most affected. Foreign trade was not spared with a fall in exports and imports.

In the three months between February and April, GDP fell 10.4% from the previous three months and the United Kingdom is preparing for a historic recession. After a 2% drop in activity in the first quarter, economists expect an unprecedented collapse in the second quarter. It could rise to 35% (still compared to the previous quarter), according to the OBR, the public institute which publishes the estimates on behalf of the government.

This fall in activity is accompanied by a surge in unemployment with a wave of job cuts which is constantly gaining momentum and which affects many sectors, especially the airline industry.

Temporary measures

To cushion the shock, the government has deployed an arsenal of measures, with guaranteed loans and short-time working. But companies fear the coming months and the gradual lifting of these devices.

Economists are predicting a rebound in activity from the second half, but they question its magnitude. Finance Minister Rishi Sunak and the Governor of the Bank of England (BoE) Andrew Bailey have recently dampened hopes for a rapid recovery, forecasting still difficult months.

► Read also: Coronavirus: the British threatened by a debt “tsunami”

Newsletter Receive all international news directly in your mailbox

Follow all international news by downloading the RFI application

• United Kingdom
• Coronavirus

On the same subject

Covid-19 crisis: BP oil group cuts 10,000 jobs worldwide

Airlines Ryanair and Easyjet ignore quarantine