G20 area's GDP growth down 0.4% QoQ in Q2 2022

The slowdown in the G20 area in Q2 2022 mainly reflected the sharp contraction in China, where GDP fell by 2.6 per cent quarter-on-quarter after rising by 1.4 per cent in Q1 2022. This contraction reflected the lockdowns that were put in place to contain COVID-19 outbreaks. GDP also contracted in India (by 1.4 per cent), in South Africa (by 0.7 per cent) and in the United Kingdom and the United States (by 0.1 per cent in both countries), the OECD said in a media release.

In India, the main reasons for the slowdown were decreases in government spending and net trade (exports minus imports). In South Africa, the economic recovery of the two previous quarters was undermined by severe flooding in a key manufacturing province. Growth also slowed but remained positive in Saudi Arabia (2.2 per cent), Indonesia (1.0 per cent), Mexico (0.9 per cent) and Germany (0.1 per cent).

Despite the contraction in GDP in the G20 area as a whole, Australia, Brazil, Italy, Japan, Korea and Turkiye recorded stronger growth in Q2 2022 than in the previous quarter. Growth in Turkiye (2.1 per cent in Q2 2022 compared with 0.7 per cent in Q1 2022) was supported by a marked increase in private consumption. In France, GDP rose by 0.5 per cent in Q2 2022 following a contraction of 0.2 per cent in the previous quarter, while in Canada growth remained steady at 0.8 per cent.

In the second quarter of 2022, GDP was lower than pre-pandemic (Q4 2019) levels in two G20 countries. In Mexico, GDP had not yet exceeded its Q4 2019 level, remaining 1.1 per cent lower than before the pandemic. In South Africa, the 0.7 per cent fall in GDP in Q2 2022 took the country’s GDP back to 0.5 per cent below its Q4 2019 level.

ALCHEMPro News Desk (KD)