cloudy.png
Friday August 7th, 2020 2:54PM

France, Spain report startling coronavirus hits to economies

By The Associated Press
Related Articles
  Contact Editor

PARIS (AP) — France and Spain both reported precipitous and worsening contractions Friday for their coronavirus-battered economies, with the Spanish economy shrinking by 18.5% and the French economy retreating by nearly 14% in the second quarter when both countries were in lockdown.

The Spanish contraction was by far the sharpest slump since the country’s national statistics agency began collecting data. Spanish Prime Minister Pedro Sánchez was meeting later Friday with the leaders of Spain’s regions to discuss how to rebuild the economy and where to deploy billions of euros in European Union aid for recovery.

Spain in mid-March went into a more than three-month lockdown, bringing much economic activity to a halt, as COVID-19 cases and deaths surged. The lockdown ended June 21.

In France, the startling plunge of 13.8% in April-June from the previous three-month period also starkly illustrated the punishing economic cost of its two-month lockdown. It was the third consecutive quarter of economic contraction in France's worsening recession. The pain has been so damaging to jobs and industries that the government is talking down the possibility of another nationwide lockdown as infections tick upward again.

France's economy was already shrinking in the last quarter of 2019, before the coronavirus pandemic hit with full force. For France and other major economies, it caused a head-spinning decline.

“All the growth in GDP seen in the 2010-2019 decade has been wiped out in five months,” said Marc Ostwald, chief economist at ADM Investor Services International.

Readjusted figured released Friday by Insee, the French statistics agency, showed that the economy shrank by 5.9% in the first quarter of 2020, as floods of COVID-19 patients started to overwhelm hospitals, prompting the lockdown. Insee's earlier estimate was of a 5.3% first-quarter plunge.

France is faring worse than Germany, Europe’s largest economy, which on Thursday reported a 10.1% plunge in GDP during the April-June period as its exports and business investment collapsed. Germany's drop was also the biggest since quarterly growth figures began being compiled in 1970, the official statistics agency said.

In March, the health crisis prompted the French government to introduce what was one of Europe's strictest lockdowns, halting much activity in the second-largest economy of the countries that use the euro currency. In France, COVID-19 has now killed more than 30,000 people and infected more than 186,000.

In releasing its morose figures Friday, Insee said the economic low point was in April, when only workers deemed essential were able to leave their homes. Activity started to pick up again from May as authorities began to ease lockdown restrictions, Insee added.

Friday's figures showed that the construction industry was among the hardest-hit in France, as worksites stood idle, with laborers forced to stay home.

Locked-down families, many surviving on government handouts and job-preservation schemes, tightened their purse strings amid fears for jobs but also because shops were closed. Household spending plunged 11% in April-June, following a drop of 5.8% in the first quarter.

Trade was also battered, as global lockdowns grounded flights, closed borders and factories, and threw transport into disarray. French imports, already down by 5.5% in the first quarter, shrank further in the second quarter, down 17.3%.

The damage to exports was even more pronounced, down by a whopping 25.5% in the second quarter after retreating by 6.1% in the first quarter.

___

Hatton reported from Lisbon, Portugal.

  • Associated Categories: Associated Press (AP), AP World News, AP Business, AP Business - Economy
© Copyright 2020 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
France, Spain report startling coronavirus hits to economies
France and Spain have both reported precipitous contractions for their coronavirus-battered economies
4:01AM ( 4 minutes ago )
Asian shares fall as data, earnings show pandemic fallout
Shares are mostly lower in Asia as data and corporate earnings capture dismal portrayals of the coronavirus pandemic's impact on world economies
3:38AM ( 27 minutes ago )
Champagne losing its fizz as global pandemic clobbers sales
Champagne is losing its fizz
3:38AM ( 28 minutes ago )
Associated Press (AP)
The Latest: South Africa's cases inch close to half-million
South Africa’s number of confirmed coronavirus cases is edging close to a half-million, with the Health Ministry reporting 11,046 new cases overnight
2:47AM ( 1 hour ago )
Asia Today: India, Philippines ease rules; Bali reopens
India added another record surge in virus cases as the government decided to lift a nighttime curfew in force since March
2:14AM ( 1 hour ago )
Trump faces rare rebuke from GOP for floating election delay
President Donald Trump is facing a rare rebuke from the Republican Party for floating the possibility of delaying the November election
1:28AM ( 2 hours ago )
AP Business
'Building bridges': How Bass became a leading VP contender
California congresswoman Karen Bass has emerged as a leading contender to be Democrats' vice presidential candidate
12:53AM ( 3 hours ago )
China's manufacturing improves in July, exports strengthen
A survey shows China’s manufacturing activity edged up in July and export orders strengthened despite weak U.S. and European demand, in fresh signs the world’s second-largest economy is gradually recovering from the coronavirus pandemic
12:17AM ( 3 hours ago )
Asian benchmarks tumble, looking to earnings, central banks
Asian shares are tumbling as earnings coming in around the world showed mostly dismal results amid the coronavirus pandemic
12:16AM ( 3 hours ago )
AP Business - Economy
Asian shares fall as data, earnings show pandemic fallout
Shares are mostly lower in Asia as data and corporate earnings capture dismal portrayals of the coronavirus pandemic's impact on world economies
3:38AM ( 28 minutes ago )
Champagne losing its fizz as global pandemic clobbers sales
Champagne is losing its fizz
3:38AM ( 28 minutes ago )
Final days of hajj and Eid festival impacted by coronavirus
Small groups of pilgrims performed one of the final rites of the Islamic hajj on Friday as Muslims worldwide marked the start of the Eid al-Adha holiday amid a global pandemic that has impacted nearly every aspect of this year’s pilgrimage and celebrations
3:27AM ( 39 minutes ago )
France sinks deeper into recession as GDP falls 14% in Q2
The French statistics agency says the country's economy shrank by nearly 14% in the second quarter, when France was in coronavirus lockdown
3:14AM ( 52 minutes ago )
Asia-Pacific tourism makes patchy restart, and some missteps
Tourism operators across Asia and the Pacific are making furtive and faltering advances, as well as some spectacular missteps, after travel was largely halted by the coronavirus pandemic that continues ebbing and mostly surging around the globe
3:02AM ( 1 hour ago )