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Asian countries on verge of severe recession due to corona crisis

Asian countries on verge of severe recession due to corona crisis

Despite all the efforts of Japan to help the economy battered by the coronavirus, its recovery more and more seems like a vague perspective. Prior to the pandemic, Japan's economy has already been staggered by low inflation and wallet-shutting tax increase. However, it was showing very bleak but reassuring signs of recovery. Yet, the coronavirus has put a deadly bullet through its heart. The latest official data on exports revealed very gloomy results. According to the reports, local producers whose business depends on foreign trade incurred staggering losses in April. Exports shrank by a whopping 22% compared to the previous month. This was the steepest fall since the 2008 financial crisis. Imports also contracted but at a slower pace. In April, it shed by 7%, undershooting its score in March. Notably, Japan is not the only Asian country that is experiencing economic havoc. South Korea's economy is in a severe situation too. In the first 20 days of May, its exports plunged by more than 20% year-on-year. Nevertheless, analysts sighed with relief as they expected a stronger fall similar to the one in April. Economists suppose that the fresh data indicates that the economy is highly unlikely to get on the road of recovery in the nearest future and the country should brace for a recession. Therefore, analysts warn that the moderate recovery trend has been put on hold as the economies of many Asian countries have entered a downward phase. In addition, it is unclear how long the virus outbreak will continue, but the Asian countries are sure to suffer from a prolonged shock.


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