The Australian economy is facing a bleak future, according to Treasurer Josh Frydenberg. Mr Frydenberg told parliament in his Economic Statement that the country’s GDP could fall by over 10 per cent in the June quarter, which would be the largest shrinkage in the country's history.
Highlights:
- GDP could fall over 10% in the June quarter, says Treasurer Josh Frydenberg.
- The states are starting to ease restrictions with national cabinet mapping out a three-stage program to help the economy return to normal.
“At $50 billion, this is a loss equivalent to the total combined quarterly production of South Australia, Tasmania, the Northern Territory and the ACT,” Mr Frydenberg said.
“Treasury is forecasting the unemployment rate to reach around 10%, or 1.4 million unemployed, in the June quarter.”
Some experts have been dreading this since the start of coronavirus pandemic.
"It might create havoc on small businesses", says economist Dr Vinod Mishra from Monash University, Melbourne.
“We are living in an integrated world. Every country is connected to other for the movement of trade, capital and people. So you cannot recover in isolation.”
Treasurer Josh Frydenberg has a coughing fit as he makes a ministerial statement to the House of Representatives at Parliament House in Canberra. Source: AAP
“I do not think the economy will return to the pre-COVID situation this year," he said.
Dr Mishra says the government has kept the economy in "a coma" with economic measures like job-keepers payment and other packages.
Dr Vinod Mishra, Monash University Source: Supplied
“The plan was to keep it suspended so that it can recover after the pandemic without much ado. However, I think the recovery will be very bumpy at its best,” opines Dr Mishra.
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'Economy will not return to the pre-COVID situation this year': Economist
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14/05/202009:55
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