How have these 40 countries fared in protecting health & the economy?
Analyzing the Q2 GDP data & fatality rate to see how some of them have fared better than the others during this pandemic
As the pandemic took hold globally earlier in 2020, most of the countries entered into a state of lockdown, which meant the economic activity came to a grinding halt. It became a balancing act for the respective governments to save the health of its people while keeping the economies intact. Although most countries suffered economic declines, the trade-off cost some countries more than the others.
Today’s infographic (above) from Our World in Data highlights the scale of the economic downturn across 40 countries for which the latest GDP data is available. The first chart (left) depicts the percentage fall in GDP seen in the second quarter (April — June) of 2020 as compared to the same period last year, adjusted for inflation.
➣ 23 of the 40 countries posted double-digit GDP losses for Q2' 2020, 16 recorded single-digit losses, while only 1 country was able to score a GDP growth.
➣ China was the only country to show a growth of 3.2 % during the second quarter — perhaps due to the fact that the pandemic was curtailed earlier in the year. First-quarter losses for the country were in the same range as some of the other countries on the list.
➣ Taiwan showed the minimum GDP fall with -0.6%, while Peru was the worst hit with a decline in GDP of 30.2%.
➣ Tunisia, United Kingdom & Spain posted GDP losses of over 20% — 21.6%, 21.7% and 22.1% respectively.
➣ Finland, Lithuania & South Korea all saw falls in their GDP of around 5% or less.
The second chart (right) compares the same GDP data against the number of confirmed COVID-19 deaths per million people — with the latter plotted on the vertical axis and the former charted on the horizontal axis. Let’s see if the presumption of the trade-off between the health & economy plays out.
➣ Contrary to the idea, countries like Peru, Spain and the UK not only suffered the highest GDP declines, the death rates were among the highest as well. In fact, Peru, which saw the biggest GDP decline also had the highest fatality rate resulting from the pandemic.
➣ And the reverse was true as well — where countries like Taiwan, South Korea, and Lithuania not only posted modest GDP losses but were also successful in keeping the death rate well in control, as evident from the second chart.
➣ Another noticeable trend was that countries with similar GDP contractions had markedly different death rates — case in point, the U.S, Sweden, Poland & Denmark. All these four countries had similar GDP declines but the first two had death rates of 5x-10x more than the latter two.
As evident from the charts, there were other factors in play apart from a single trade-off between health and the economy dictating how the countries fared during the pandemic. Policy decisions taken by each government on how to control the spread of the virus were as important as any. The assumption that a trade-off between the health and economy was the only relationship playing out is simply not true.
Having said that, the pandemic is far from over. Other variables like the availability of vaccines will also come into play and ultimately decide who comes out less scathed from the health crisis of the century.