UK economy could be among the worst hit of leading nations

UK economy could be among the worst hit of leading nations

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[Newsphopick=Gyubin Lee] The UK is likely to be the hardest hit by Covid-19 among major economies, the Organisation for Economic Co-operation and Development has warned. Britain's economy is likely to slump by 11.5% in 2020, slightly outstripping falls in countries such as Germany, France, Spain, and Italy, it said.

If there were a second peak in the pandemic, the UK economy could contract by as much as 14%. "The crisis will cast a long shadow over the world," the OECD added. It said that in what it called a "single-hit scenario", with no second peak, there could be contractions of 11.4% in France, 11.1% in Spain, 11.3% in Italy, and 6.6% in Germany. 

In its latest assessment, the OECD found that the UK's largely service-based economy meant that it had been particularly badly hit by the government's lockdown restrictions. The services sector, including financial services, hospitality, and tourism, makes up about three-quarters of the UK's GDP. 

In response to the think tank's report, Chancellor Rishi Sunak said the UK was not the only one to suffer: "In common with many other economies around the world, we're seeing the significant impact of coronavirus on our country and our economy. 

"The unprecedented action we've taken to provide lifelines that help people and businesses through the economic disruption will ensure our economic recovery is as strong and as swift as possible." 

Shadow chancellor Anneliese Dodds said: "Today's evidence from the OECD is deeply worrying, showing the UK was particularly exposed when the coronavirus crisis hit. "The government's failure to get on top of the health crisis, delay going into lockdown and chaotic mismanagement of the exit from a lockdown are making the economic impact of this crisis worse."

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