Bleak figures from China and US show economic hit from virus
● Unemployment swells towards levels last seen in Great Depression
Bleak figures from the world’s two largest economies underscore how quickly the coronavirus is delivering a massive economic blow.
China yesterday reported that GDP shrank 6.8 per cent in the quarter ending March compared with a year ago, its worst contraction since before market-style economic reforms began in 1979.
In the US, the world’s largest economy, the ranks of the unemployed swelled by millions towards levels last seen during the Great Depression.
Still, the economic data from China was not as bad as some had feared, prompting shares in Asia to surge. That was after Wall Street also rose, powered by buying of Amazon, healthcare stocks and other market niches that are thriving in the coronavirus crunch. Howevallow er, the recovery for workers is likely to take a long time.
Some forecasters earlier said China might rebound as early as this month, but they have since been cutting growth forecasts and pushing back recovery timelines as negative trade figures, retail sales figures and other data pile up.
The US government reported 5.2 million more Americans applied for unemployment benefits last week, bringing the four-week total to 22 million – easily the worst stretch of US job losses on record.thenumberstranslate to about one in seven workers in America.
Meanwhile, South Korea yesterday reported its worst unemployment figures in more than a decade, with almost 200,000 fewer people working in March than in the same month a year earlier.
US president Donald Trump reacted to the pressure on the economy by outlining a phased approach to reopening parts of the country where the pandemic is being brought under control.
He told state governors that restrictions could be eased to
businesses to reopen over the next several weeks in places that have extensive testing and a marked decrease in Covid-19 cases.
“We are not opening all at once, but one careful step at a time,” Mr Trump said, adding that his new guidelines give governors the freedom to act as they see fit.
His comments marked an abrupt change after a week in which he clashed with states over his claim that he had “total” authority over how and when the country reopens.
Worldwide, the outbreak has infected more than 2.1 million people and killed more than 144,000, according to a tally by Johns Hopkins University, though the true numbers are believed to be much higher.
The death toll in the US topped 33,000, with more than 670,000 confirmed infections.
China raised its death toll to over 4,600 after the city of Wuhan, where the outbreak first took hold, added nearly 1,300 deaths. State media said the undercount was due to updated reporting from overwhelmed medical facilities and deaths outside hospitals.
Questions have long swirled around the accuracy of China’s case reporting, with some saying officials sought to minimise the outbreak.
The spread of the virus is declining in such places as Italy, Spain and France, but rising or continuing at a high level in Britain, Russia and Turkey.
Singapore reported a record daily high of 728 new cases as it ramped up testing at dormitories crammed with foreign workers.
Elsewhere, United Nations Secretary-general Antonio Guterres warned the economic impacts of the pandemic were putting many of the world’s children in jeopardy, and urged families and leaders everywhere to help protect them.
In a video statement he said the lives of children were being “totally upended” by Covid-19, with almost all students out of school, family stress levels rising as communities face lockdowns, and reduced household income expected to force poor families to cut back on essential expenditure.