The Australian Bureau of Statistics said on Wednesday that the country’s gross domestic product (GDP) fell 7% in the second quarter compared to the previous quarter.
This marked the second consecutive quarter of decline for Australia, after GDP contracted by 0.3% in the first quarter, as well as being its largest decline since records began in 1959. It was also worse than the expected decline of 5.9%, in a poll. For analysts conducted by “Refinitiv”.
The authorities attributed the decline to the spread of the epidemic and the closure measures taken by the country to contain the virus, although Australia was already facing several other problems before the outbreak of Corona, as the country was destroyed earlier this year due to the worst forest fire it has witnessed in decades, impeding consumer spending and tourism, according to Australian Tourism Export Board.
Household consumption decreased in the fourth quarter by more than 12%, while spending on services decreased by 18% in light of the closure of restaurants and hotels.
“We have done everything in our power to mitigate the blow to the Australian community from the Covid-19 virus,” Treasury Treasurer Josh Friedenberg said in Canberra on Wednesday. Our priority has been and will remain to save lives and ensure that Australia’s healthcare system has the capacity to test, track and treat cases. Coronavirus infection. ”
The country is likely to face more pain, as the RBA said the pace of recovery after the fourth quarter is uncertain and depends on how long the virus outbreak lasts.
And Victoria, Australia’s second-most populous city and home to Melbourne, is now suffering from the most severe restrictions Australians have experienced during the pandemic, after a brutal second outbreak of the virus.
The recession is exceptional for the Australian economy, which has enjoyed 29 years of economic growth, due to China’s voracious appetite for commodities, such as iron ore and coal, while China rose to become the second largest economy in the world.
It is worth noting that the relationship between the two countries has worsened recently, after tensions between China and Australia expanded, following the latter’s request for an investigation to trace the origins of the epidemic.