Economy & Politics

These EU countries are suffering particularly badly from the Corona crisis

The economic effects of the Corona crisis were particularly strong in the second quarter. The gross domestic product in the euro area collapsed by almost 15 percent, as calculated by the statistical office of the European Union Eurostat. How well the European countries were able to recover economically in the summer months are now shown by Eurostat’s flash estimates of gross domestic product in the third quarter. In the euro area, GDP rose by 12.6 percent compared to the second quarter. Compared to the same quarter of the previous year, however, there is still a minus of 4.4 percent in the third quarter.

The data does not yet show how hard the second corona wave will hit the economies of European countries. The third quarter comprises the months of July to September. However, the pandemic only worsened in most countries afterwards.

The list of countries recorded by Eurostat is not yet complete; there is a lack of data from Estonia, Ireland, Greece, Luxembourg, Malta, Slovenia, Iceland, Norway and Switzerland. One thing is clear from the data: As in the second quarter, the economy is weakening, especially in those countries where tourism plays an important role in the national economy.

Germany is not one of the ten countries with the greatest slump in GDP. Here the gross domestic product fell by 4.2 percent compared to the same quarter of the previous year. This puts Germany below the EU average (4.3) and the euro area average (4.4). Compared to the second quarter, the GDP in Germany was able to recover by 8.2 percent.

Great Britain had to cope with the sharpest slump: Here, GDP fell by 9.6 percent in the third quarter of 2020 compared to the same period of the previous year. But Great Britain is also reporting a significant recovery: Compared to the second quarter of 2020, GDP increased again by 15.5 percent. In the second quarter, GDP fell by 21.5 percent.

But not only the corona crisis is depressing the mood in Great Britain. A possible threat of a no-deal Brexit with the EU also unsettles the economy. There could still be a hard divorce if there is no free trade agreement with the EU by the end of the year. The British and Europeans don’t have much time left: the agreement must be ratified by all member states, Great Britain and the European Parliament by December 31st.

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