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UK economy officially in recession

Published

6 years ago

2020/08/13

The UK economy has shrunk by 20.4% between April and June, when the coronavirus lockdown was at its most severe. Experts say the downturn brought on by the pandemic led to the biggest fall in quarterly GDP on record.

The UK on Wednesday officially fell into recession for the first time in 11 years. The economy collapsed by a record 20.4% in the second quarter, compared to the first quarter, as a result of coronavirus lockdown measures imposed to contain the outbreak, agency reports said.

Between April and June, household spending plunged as businesses were ordered to shut down, while industries such as construction rolled back on output and production.

“The recession brought on by the coronavirus pandemic has led to the biggest fall in quarterly GDP on record,” Jonathan Athow of the Office for National Statistics (ONS) said.

Data from the ONS showed that the UK economy had a 2.2% quarterly contraction in the first three months of the year.

The technical definition of a recession is two straight quarters of economic decline.

The economic decline was concentrated in April — the peak of lockdown.

The ONS said the economy bounced back in June as the government started to relax coronavirus restrictions.

Non-essential retailers in England, including clothes shops and bookshops, reopened their doors on June 15.

“The economy began to bounce back in June with shops reopening, factories beginning to ramp up production and house-building continuing to recover,” Athow said. But “Despite this, gross domestic product (GDP) in June still remains a sixth below its level in February, before the virus struck,” he added.

The UK’s service sector, which makes up four fifths of the economy, suffered the biggest quarterly decline on record. Car manufacturing, meanwhile, faced its slowest production rate since 1955.

Chancellor of the Exchequer Rishi Sunak warned that the economic slump would lead to further job losses in the coming months.

“Today’s figures confirm that hard times are here,” Sunak said. “Hundreds of thousands of people have already lost their jobs, and sadly, in the coming months many more will.”

Some 1.2 million employers have taken advantage of the government’s Coronavirus Job Retention Scheme to furlough 9.6 million people at a cost to the government of 33.8 billion pounds ($44 billion, €38 billion).

Sunak said he is ending the program in October because it gives “false hope” to furloughed workers and hinders them from getting new jobs as their skills decline.

The UK’s recession is deeper than those recorded by comparable countries such as the US and other European economies, notably Germany and France.

Germany’s governing coalition in June agreed on a €130 billion stimulus package to help pull the country’s economy out of recession. The government hoped the package would ease Germans’ financial strain and boost consumer spending.

In comparison to other European countries, Germany’s almost one month of lockdown was relatively short. But the German economy still went into recession in the first quarter of 2020.

Unemployment in May rose from 5.8% to 6.3%, figures which could have been higher if it were not for Germany’s “kurzarbeit” program, a wage subsidy scheme that allows struggling companies to decrease employees’ working hours instead of making them redundant.

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Ambassador of Switzerland to Sri Lanka pays courtesy call on PM

Published

5 hours ago

2026/02/19

Priyan

The Ambassador of Switzerland to Sri Lanka Dr. Siri Walt paid a courtesy call on Prime Minister Dr. Harini Amarasuriya on the 17th of February at the Temple Trees.

Welcoming the Ambassador of Switzerland to Sri Lanka the Prime Minister briefed the Ambassador on her recent visit to Davos to participate in the World Economic Forum Annual Meeting noting that the series of high-level bilateral meetings held on the sidelines of the Forum, along with two important industry visits provided valuable insights for Sri Lanka’s economic engagement.

The discussion focused on Switzerland’s vocational education and training (VET) system, with particular interest in exploring possible cooperation and knowledge-sharing opportunities.

The Prime Minister also conveyed her appreciation for the assistance extended by the Government of Switzerland following Cyclone Ditwah. She emphasized Sri Lanka’s need for enhanced technical assistance during the ongoing rebuilding phase, especially in relation to the reconstruction of bridges and railway infrastructure.

Both sides reaffirmed their shared commitment to further strengthening bilateral relations between Sri Lanka and Switzerland, and to expanding cooperation in areas of mutual interest.

First Secretary (Political) of the Embassy of Switzerland in Colombo Ms. Justine Boillat, First Secretary (Migration) of the Embassy of Switzerland in Colombo Ms. Andrea Kienast and the Secretary to the Prime Minister, Pradeep Saputhanthri, Additional Secretary to the Prime Minister, Ms. Sagarika Bogahawatt and officials from the Ministry of Foreign Affairs , Foreign Employment, Tourism.attended the meeting.

[Prime Minister’s Media Division]

Latest News

Advisory for low pressure area in the Southwest Bay of Bengal to the south-east of Sri Lanka

Published

6 hours ago

2026/02/19

Priyan

Location of the low-pressure area in the Bay of Bengal Sea area

Advisory for low pressure area in the Southwest Bay of Bengal to the south-east of Sri Lanka.
Issued by the Natural Hazards Early Warning Centre of the Department of Meteorology at 03.00 pm on 18 February 2026

Multiday boats fishermen and naval community are warned that the low-pressure area still persists over the Southwest Bay of Bengal to the south-east of Sri Lanka. Under the influence of this system, heavy showers or thundershowers, Strong winds about (50-60) kmph, and rough or very rough seas can be expected in these sea areas.

The Meteorological Department is constantly monitoring the behavior of the system.

The naval and fishing communities are requested to be attentive to the future forecasts and bulletins issued by the Department of Meteorology in this regard.

News

Canada concerned about delay in holding PC polls

Published

7 hours ago

2026/02/19

Sahan Weerasooriya

Canadian High Commissioner Isabelle Martin shaking hands with Minister Abayaratne

Canada, said to be the home to the largest Tamil Diaspora community, has expressed concern over the delay in holding Provincial Council (PC) elections. Canadian High Commissioner Isabelle Martin, on Monday (16), took up the issue with Public Administration, Provincial Councils and Local Government Minister Professor Chandana Abayaratne.

Sources quoted Prof. Abayaratne as having told the Canadian HC that the delay was not deliberate on the part of the government. The Minister blamed, what the sources called, certain legal, technical and delimitation issues for the delay.

India compelled Sri Lanka to enact the 13th Amendment to the country’s Constitution to enable the setting up of the Provincial Council system, in line with the Indo-Lanka Peace Accord, which Sri Lanka signed under duress in July 1987.

Prof. Abayaratne has assured the Canadian HC that President Anura Kumara Dissanayake, too, recognised the importance of strengthening the Provincial Council system as a solution to ethnic issues and that urgent steps would be taken in that regard.

During the discussion, matters relating to strengthening political, economic and social relations between the two countries were discussed.

In May 2020, Canada declared that Sri Lanka had perpetrated genocide during the war against the LTTE. Canada also sanctioned former Presidents Mahinda Rajapaksa and Gotabaya Rajapaksa in January 2023 over alleged war crimes.

The Canadian HC also explained her country’s ‘Indo-Pacific’ strategy and how Sri Lanka could benefit from it.

In particular, Canada’s “Pathways to Peace” project will support reconciliation between nations, and to improve communication by encouraging the learning of mutual languages as a second language, and it was also agreed to provide more opportunities for Sri Lankan students to pursue higher studies in Canada.

The Canadian delegation also expressed its willingness to provide the necessary technical assistance to solve the drinking water problems in Puttalam, Mannar and the North-Eastern provinces under technical cooperation, and to implement the relevant projects after a preliminary study.

by Shamindra Ferdinando