The economic impact of the corona virus pandemic is currently forecast to be lower than initial estimates, it has been revealed.
At yesterday's media briefing, which outlined plans for a ‘revised’ Phase 5c, current CCA President Gavin St Pier shared the most recent figures for the costs of tackling the virus, supporting the community during the height of lockdown, and the timeframe in which we are expected to recover financially.
“Our current forecast for the public finances for 2020 is a ‘covid cost’ of £136 million, against an estimate of £173 million made in May,” he said. Likewise, the economy is forecast to shrink 6.4% this year; a significant impact, but far smaller than the 9% predicted earlier this year. A 4.8% growth is estimated during 2021.
The pandemic response has incurred significant cost to the public purse. During lockdown, the States made arrangements to borrow up to £500 million should the need arise.
Pictured: Unemployment figures fell by more than 100 in September, to 570, which takes unemployment to 1.8% of the working population.
But on-island restrictions were eased relatively swiftly, and schools, businesses and bars have been operational since June.
More than two months of lockdown still took its toll. Even in Phase 5, roughly a third of self-employed islanders were on much-reduced earnings. The hospitality industry is also still suffering from a lack of tourists, and States support for the sector continues through a new scheme that combines grants with the existing payroll co-funding.
The Chief Minister said the positive upturn in employment and forecasts should not come as a surprise.
“It isn’t a choice between public health and the economy. If we make the right decisions and keep the public health bit under control, which we have up until now, the economic damage is lessened.
“From a health, social and economic perspective, we are in a very good position compared to so, so many jurisdictions. And all the more so that we continue to be able to avoid non-pharmaceutical interventions such as social distancing and face masks, which further benefit confidence in the economy, and long may this continue.”
Click HERE to read more about the latest changes to Guernsey’s travel restrictions.