Global recession in making? Markets across UK, Japan on severe fall, 18 countries on verge of failing economies

Meanwhile, in contrast to the downturn experienced by Japan, Britain and Germany, the Indian economy continues its robust growth trajectory.

Edited By: Mayank Kasyap

Last Updated : 22 February 2024, 11:06 PM IST

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New Delhi: The specter of recession looms over global economies as both Japan and Britain face consecutive quarters of declining GDP, sparking concerns of a broader economic slowdown. While the focus remains on these major economies, 18 countries worldwide have witnessed GDP contractions, signaling widespread economic challenges.

Japan and UK enter recession

Japan and Britain officially entered a technical recession during the September-December quarter of 2023, with their GDPs declining for two consecutive quarters. Japan, once the world's third-largest economy, suffered significant setbacks, while Britain also experienced economic contraction. The headlines are dominated by the economic woes of these two major nations, reflecting the heightened risk of recession across the globe.

Expansion of recession trends

The fear of a broader technological recession grips various regions worldwide. Ireland and Finland, alongside Japan and Britain, joined the list of countries experiencing recessionary pressures during the fourth quarter. Japan's GDP declined by 3.3 percent in September, followed by a 0.4 percent dip in December, while the UK saw a 0.1 percent and 0.3 percent shrinkage in the same periods, respectively. Ireland recorded a 0.7 percent and 1.9 percent GDP decline, while Finland reported a 0.4 percent and 0.9 percent contraction during the respective quarters.

Signals of recession in 10 other countries

Beyond Japan, Britain, Ireland, and Finland, 10 countries reported GDP contractions during the July-September quarter. These countries include:

Denmark
Luxembourg
Moldova
Estonia
Ecuador
Bahrain
Iceland
South Africa
Canada
New Zealand

First-time GDP declines

Furthermore, six countries reported their first GDP declines during the December quarter. Malaysia, Thailand, Romania, Lithuania, Germany, and Colombia faced economic contractions, with Germany's GDP witnessing a 0.3 percent decline. These developments underscore the widespread economic challenges faced by nations across the globe.

Indian economy bucks the trend

In contrast to the downturn experienced by Japan, Britain, and Germany, the Indian economy continues its robust growth trajectory. Praised by institutions like the World Bank and the IMF, India is hailed as the world's fastest-growing economy. Leading rating agencies predict India's ascent to become the third-largest economy globally by 2027. However, India remains vulnerable to global economic conditions, highlighting the interconnectedness of economies in the era of globalization.

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Global recession in making? Markets across UK, Japan on severe fall, 18 countries on verge of failing economies