Spain’s Economy Plummets
The World continues to bend the knee to the rule of the novel coronavirus and Spain is one of the latest victims, as reports show they plunged into recession in the second quarter after their gross domestic product tumbled by 18.5 percent due to the coronavirus pandemic.
In the first quarter, growth had fallen by 5.2 percent, hence the recession.
The business, transport and hotels sector were all badly hit, with a 40 percent drop compared with the first quarter, thanks to the lockdown measures announced in March.
And tourism, a pillar of the Spanish economy which accounts for 12 percent of GDP, suffered with a 60 percent drop in revenues compared the same period in 2019.
Construction fell by 24 percent compared with the first quarter and industry by 18.5 percent. Household consumption dropped by around 21 percent and business investment by 22 percent while exports fell by around a third.
The record plunge in Spain’s GDP of 18.5 percent is likely to have been one of the biggest falls of any euro-zone country in the second quarter, illustrating the severity of the country’s lockdown and its slow and partial recovery – and the rise in COVID19 cases is likely to hold back the recovery in tourism.
The virus has killed more than 28,400 people in Spain.
Unemployment hit 15.3 percent by the end of June and is expected to reach 19 percent by the year’s end, the government says, although the IMF sees it rising to as much as 20.8 percent.