Second wave in Victoria hinders Australian recovery
The spike in COVID-19 cases throughout Melbourne over the past week is expected to slow the recovery of the Australian economy, says market researcher IBISWorld, as Victoria is the second biggest contributor to national GDP.
More than 537 new cases of COVID-19 were recorded in Victoria in the past week, prompting a return to lockdown across 12 suburbs, including the complete quarantine of several high-rise towers.
In 2018-19, Victoria contributed 23.7 per cent of Australia’s national GDP, with most of this productivity coming from wholesale (18.7 per cent), retail (13.7 per cent), construction (13.5 per cent) and manufacturing (12.8 per cent) sectors.
As a result of Victoria’s slide, Australian GDP is expected to decline by 1.0 per cent in 2020-21, before recovering by 4.3 per cent in 2021-22.
“The second wave of COVID-19 cases in Victoria is a threat to overall Australian recovery. It underscores just how quickly this virus can return and should make other states and territories wary of relaxing quarantine measures too quickly,” said IBISWorld Senior Industry Analyst Yin Yeoh.
The latest outbreak is expected to postpone any plans for Australia to reactivate international travel with other countries that have contained COVID-19, such as New Zealand and Thailand.
“While Victoria has been the first Australian region to experience a second wave of COVID-19, it is unlikely to be the last. Local outbreaks and lockdowns are likely to be the new normal for some time,” said Ms Yeoh.
How do you think we can contend with multiple outbreaks over time? What are your hopes for the ‘new normal’?