Canada’s economy is on the brink of recession after falling 38.7 percent in the second quarter of 2020 on an annual basis (year to year/yoy). The country’s economy has collapsed due to the coronavirus pandemic.

quote AFP, Friday (28/8), the coronavirus pandemic forced the Canadian government to restrict movement in public spaces by closing businesses. Thus, the business world cannot operate normally like a normal situation.

This economic downturn is in line with falling consumer spending, business investment, trade and tourism. However, all this had already been predicted by analysts.

Meanwhile, quoting tradingeconomy.comCanada’s economy shrank 11.5 percent in the second quarter of 2020 on a quarterly basis. This is a record high because previously the Canadian economy fell 2.1 percent on a quarterly basis.

Household spending fell 13.1 percent and business investment fell 16.2 percent.

This decline in investment reflects limited construction activity, factory closures, low oil prices, and increased uncertainty.

In addition, government spending fell 2.7 percent, exports fell 18.4 percent, and imports fell 22.6 percent. Export and import activities shrank as the economy of Canada’s trading partners also plummeted due to the coronavirus pandemic.

The Canadian economy has been contracting since early 2020. In the first quarter of 2020, the country’s economy was minus 8.2 percent year-on-year as consumption levels weakened and businesses stopped due to the pandemic.

The Canadian government itself has made various efforts to save society and the economy that was hit by the pandemic. One of them is the Canada Emergency Response Benefit program or the Canadian Emergency Response Benefits program.

The program is a financial aid for Canadians affected by the coronavirus pandemic. Residents can apply independently to get this assistance.

Canada is not the first country whose economy has crashed due to the pandemic. Previously, there was the United States (US) which officially entered the brink of recession because its economy was minus in two consecutive quarters.

It was noted that the US economy was minus 5 percent in the first quarter of 2020. Then, the country’s economy contracted again by 32.9 percent in the second quarter of 2020.

Likewise with Germany. The German economy in the first quarter of 2020 was minus 2.2 percent and the second quarter of 2020 was minus 10.1 percent.

In addition, South Korea is also on the list of countries entering the brink of recession. The country’s economy contracted 1.3 percent in the first quarter of 2020 and further contracted to 3.3 percent in the second quarter of 2020.

Furthermore, Singapore’s economy is also in the red this year. In detail, Singapore’s economy in the first quarter of 2020 was minus 0.7 percent and the second quarter of 2020 was minus 42.9 percent.

(aud/sfr)