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Australia’s GDP will fall by 10 percent and the unemployment rate is likely to double in the second quarter due to the coronavirus, the country’s head of the Treasury said in a speech on Tuesday.
The twelfth largest economy in the world will lose around A $ 4 billion ($ 2.6 billion) each week due to restrictions on movement and economic activity, according to excerpts from Josh Frydenberg’s speech seen by Reuters.
But Frydenberg is expected to say the impact would have been much worse if Australia, with more than 6,800 coronavirus infections and 96 deaths, had followed Europe’s lead and imposed stricter controls on all non-essential services.
“If these restrictions were further increased, similar to the eight-week blockade in Europe, then the adverse impact on GDP could double to 24 percent,” the Treasurer will say.
“This would have seen enormous stress on our financial system as a result of increasing deficiencies in the balance sheet, the widespread closure of companies, higher unemployment, and household debt. This was the cliff we were standing on. “
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