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A second wave of COVID-19 has hit Europe. Well being officers predicted this consequence as governments lifted social restrictions, which permitted the virus to unfold. Now, governments once more should grapple with whether or not to reimpose restrictions, with all of the unfavorable penalties that entails for financial exercise. The above figures illuminate what these penalties appeared like on the peak of Europe’s lockdowns.
Trying on the steep decline in gross home product and employment, it’s obvious why international locations are hesitating to reimpose anti-coronavirus measures. This time round, we’re seeing a extra focused strategy in opposition to the virus. France, for instance, has imposed curfews solely in choose cities, whereas Spain has closed down companies like bars and eating places.
Because the graphic exhibits, first-quarter drops in GDP in 2020 had been akin to declines seen in the course of the 2008-09 disaster. Second-quarter numbers had been far worse. What’s extra, elements of Europe by no means absolutely recovered, or had solely not too long ago recovered, from the Nice Recession and the eurozone disaster. These economies can be much less resilient to the COVID-19 shock.
2020 will see a deep recession for Europe. What European leaders hope now could be that over the approaching months and years their economies can draw back from the lows of the second quarter.