Australia set for first recession in 29 years
Data released by the Australian Bureau of Statistics (ABS) on Wednesday revealed that the Australian economy shrank by 0.3 percent in the March quarter as a result of the bushfire crisis and early stages of the coronavirus pandemic.
It marks the first quarter of negative growth since 2011 and with COVID-19 set to have a bigger economic impact in the second quarter of 2020 it means that Australia is certain to enter a state of recession, defined as two consecutive quarters of GDP contraction, for the first time since 1991.
Treasurer Josh Frydenberg said that in the context of the bushfires and the pandemic Australia's economy has been remarkably resilient.
«Seen in this context, the fact that the Australian economy only contracted by 0.3 per cent shows the Australian economy's remarkable resilience,» he said.
Prior to the full effects of coronavirus hitting Australia, GDP growth fell to 1.4 percent in the 12 months to March 2020 - the lowest annual growth figure in more than a decade.
«This was the slowest through-the-year growth since September 2009 when Australia was in the midst of the Global Financial Crisis and captures just the beginning of the expected economic effects of COVID-19,» ABS chief economist, Bruce Hockman, said in a statement.