Top-20 world economies: the GDP dynamics for the I-II quarter 2020

The pandemic COVID-19 and restrictions related to it have significantly hit the world largest economies. Current data on the GDP dynamics for the I-II quarter 2020 gives evidence to different level of drop and time required for the recovery to the lost positions.

China became the first country to face the strict lockdown. It lead to a drop in the GDP in the I quarter 2020 by - 6,8% to the same period of the previous year. The indicator became the worst since 1976. However, in the II quarter 2020 the economy resumed the growth. Thus, the negative effects of the restrictions in the Celestial Empire might be overcome by the end of 2020.

The USA is just entering the crisis: after the nominal growth in the I quarter 2020, the GDP in the II quarter has fell by -9,5% at once to the II quarter 2019 – the largest quarter drop ever in the history of monitoring since 1948.

Western Europe bears the biggest losses. It has come across the largest crisis after the end of the Second World War. The year on year GDP in Spain in the II quarter 2020 reduced by -22,1%, in United Kingdom by -21,7%, in France by -19%, in Italy by -17,3%, in Germany by -11,3%. It will take several years to get back to the pre-pandemic level. Another economic shutdown will drive back the EU development on several decades, in case of the second wave of the pandemic.

Russia has suffered in a smaller extent: in the I quarter 2020 the growth by 1,6%, was noted, in the II quarter 2020 - the decline by -8,5%.

It’s revealing that countries with the high industry share in the GDP have suffered less from the crisis than those where the services sector is dominant. Read about this in our previous publication.

Table 1. The GDP dynamics in the I - II quarter 2020, Top-20 world economies
Rank Country GDP (PPP), USD trillion, 2019 GDP dynamics, I quarter 2020 to I quarter 2019, % GDP dynamics, II quarter 2020 to II quarter 2019, %
1 China 27 307 -6,8 3,2
2 USA 21 428 0,3 -9,1
3 India 11 043 3,1 no data
4 Japan 5 712 -1,7 -9,9
5 Germany 4 444 -2,3 -11,3
6 Russia 4 390 1,6 -8,5
7 Indonesia 3 736 3,0 -5,3
8 Brasilia 3 481 -0,3 no data
9 United Kingdom 3 162 -1,7 -21,7
10 France 3 062 -5,0 -18,9
11 Mexico 2 616 -1,4 -18,7
12 Italy 2 455 -5,4 -17,3
13 Turkey 2 362 4,5 no data
14 Republic of Korea 2 320 1,4 -2,9
15 Spain 1 924 -4,1 -22,1
16 Canada 1 904 -0,9 -13,0
17 Saudi Arabia 1 901 -1,0 no data
18 Iran 1 491 no data no data
19 Egypt 1 391 5,0 no data
20 Thailand 1 378 -1,8 -12,2

Source: IMF, EUROSTAT,OECD, public sources, Credinform calculations

With the multidirectional regional GDP dynamics, the competition in the world will strengthen: the most affected countries will have to protect their companies and markets with the highest possible range of protectionist measures. On the other hand, the new possibilities are opened for the changes of the global production and sale.

Rules of financial reporting

In 2020, the financial statements for 2019 were first provided by the State information resource of accounting (financial) statements (GIR BO), the maintenance of which is entrusted to the Federal Tax Service of the Russian Federation, as we reported in our publication in 2018.

According to the Federal Law of November 28, 2018 No.444-FL “On Amendments to the Federal Law “On financial accounts”, a mandatory copy of the annual financial statements to the tax authorities at the location of the company must be submitted no later than 3 months after the end of the reporting period. In case of any errors are found, the adjusted reporting is submitted no later than 10 working days after the day of making the corrections or the day of approval of the annual reporting.

The following entities are exempted from filing the mandatory copy of the annual financial statements:

  • public sector organizations;
  • the Central Bank of the RF;
  • religious organizations;
  • credit and non-credit institutions filing accounting statements to the CB RF;
  • organizations that accounting statements are concerned as state secret;
  • other organizations – according to the decision of the Government of the RF.

In addition, the latest reports are not submitted by reorganized or dissolved legal entities.

State and municipal authorities submit reports using the system of interdepartmental information interaction.

Financial statements are submitted only to the Federal Tax Service of the Russian Federation. Submission of reports to the bodies of the Federal State Statistics Service is no longer required.

Financial statements must be submitted only in the form of an electronic document. In 2020, small business entities can submit reports both in paper and electronic form.

The Federal Tax Service of the Russian Federation emphasizes that the correct Russian Economic Activities Classification System code (OKVED) must be entered in the accounting forms, reflecting the type of activity that the organization was engaged in for the reporting year. If OKVED code differs from the OKVED codes specified in the Unified State Register of Legal Entities, the organization must declare the appropriate changes to the register.

OKVED code is used in calculating the average industry indicators, as well as indicators of the tax burden, average wages and others. Statistical authorities use OKVED in statistical monitoring.

The subscribers of the Information and Analytical system Globas have access to financial statement of all legal entities of Russia since 1997.