Virus-hit UK economy stages stronger recovery

2 April, 2021 12:00 AM printer

LONDON: Britain's economy staged a stronger-than-expected bounceback in the second half of 2020, official data showed Wednesday, indicating a nascent recovery from the damaging coronavirus crisis.

Gross domestic product expanded by 16.9 percent in the third quarter as the economy temporarily reopened from lockdown, the Office for National Statistics (ONS) said in a statement.

That marked an upgrade from the prior estimate of 16.1-percent growth, reports AFP.

And the economy grew 1.3 percent in the fourth quarter despite renewed Covid restrictions, up on the earlier figure of 1.0 percent.

"At one time there had been strong belief that the fourth quarter would see a renewed economic contraction," noted EY economist Howard Archer.

"However, it is evident that lessons have been learned in keeping activity going amid Covid-19 restrictions."

Activity did however plunge by a bigger-than-expected 19.5 percent in the second quarter as a result of Britain's initial lockdown.

The earlier estimate was put at 19 percent.

As a result of the revisions, the ONS added that the UK economy tanked 9.8 percent overall last year, which was a modest upgrade from 9.9 percent.

However, that still represented Britain's biggest slump in three centuries -- and the worst performance among the G7 nations for last year.

The economy is now 7.3 percent smaller than its pre-pandemic level, an upgrade from the previous estimate of 7.8 percent.

Economist Ruth Gregory, at research consultancy Capital Economics, added that the second-half revisions mean that the economy "does not have quite as far to recover from the Covid-19 crisis".