Eurozone economy shrinks record 12.1% due to coronavirus | Business

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The extent of the impact of Covid-19 on the euro area economy has been exposed by figures showing the single currency area shrank by a record 12.1% in the second quarter of 2020 .Amid growing fears that Europe’s interim recovery is about to be affected by a second wave of crisis, the statistical arm of the European Union, Eurostat, has provided glaring evidence of the decline in activity caused by the almost total lockdowns imposed by some countries in the spring.

Eurostat data revealed that the contraction in the second quarter – combined with a smaller drop in the first three months of the year – wiped out a decade and a half of expansion, pushing the euro area economy down to its mid-2000s level. Italy – which has struggled to grow since the adoption of the single currency – has seen its GDP return to mid-1990s levels.

In Spain, where concerns about a second wave are most acute, the largest drop in output was recorded in the second quarter, with a GDP drop of 18.5%. The fall, unmatched even during its 1930s civil war, followed a 5.2% contraction in the first quarter and means the euro area’s fourth-largest economy contracted by almost a quarter in the first half of the year. 2020.

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