• By The Financial District

AUSTRALIA SNAPS 29-YEAR ECONOMIC GROWTH, SINKS INTO RECESSION

The coronavirus pandemic has officially pushed Australia into its first recession in nearly three decades, Laura He and Angus Watson reported for CNN Business on September 2, 2020.

The country's GDP contracted 7% in the second quarter compared to the prior one, the Australian Bureau of Statistics (ABS) said Wednesday. It marks the second straight quarter of declines for Australia — GDP shrank 0.3% in the first quarter — and the largest drop since records began in 1959. It was also worse than the estimated 5.9% drop expected in a poll of analysts by Refinitiv.


Authorities attributed the fall to the pandemic and shutdown measures the country has taken to contain it, though Australia had already been wrangling with issues before then. The country was ravaged earlier this year by the worst wildfires it had seen in decades, which hampered consumer spending and tourism, according to the Australian Tourism Export Council.


In the most recent quarter, the closures of hotels, restaurants and other services because of the pandemic clearly took a hit: Household consumption plunged more than 12%, while spending on services cratered nearly 18%. "We have done everything possible to cushion the blow for the Australian community from COVID-19," Treasurer Josh Frydenberg said in Canberra on Wednesday. "Our priority has and will continue to be saving lives and ensuring that Australia's healthcare system has the capacity to test and to trace and to treat coronavirus cases."