LONDON, April 28 (Xinhua) -- Britain's economy is estimated to shrink by 7.2 percent this year if the lockdown continues till the middle of May, said the National Institute of Economic and Social Research (NIESR) Tuesday.
"The economic outlook is extremely uncertain and depends critically on the duration of the lockdown measures and the effectiveness of the government's economic policies," Garry Young, NIESR deputy director, said in a webinar during which the data was revealed.
According to the latest estimate of NIESR, Britain's GDP fell by around 5 percent in the first quarter in 2020 and will drop 15 percent in the second quarter.
On the assumption of a progressive relaxation of stay-at-home measures, the institute projected that by the fourth quarter 2021, Britain's economy could recover some of the lost ground and almost re-attain its level of the last quarter in 2019.
In its main-case forecast scenario, NIESR also predicts Britain's economic growth rate will bounce back to 6.8 percent next year.
Meanwhile, Young pointed out it is necessary that "the complex network of relationships" that make up the economy can be restored after the lockdown "without any significant long-term damage" to reassure their main-case forecast scenario.
"So far the signs are promising, but the most significant challenges are likely to come as we approach end or winding down of the lockdown and the supportive schemes are withdrawn," said Young.
"In those circumstances, the government schemes will need to be adapted to help businesses survive in a partially recovered economy," he added.
Chancellor of the Exchequer Rishi Sunak told MPs on Monday that he is planning a "gradual" winding down of the government's job support scheme so as to avoid soaring unemployment after its planned expiry on June 30.
In March, among other measures, the British government pledged to provide 330 billion pounds (about 410 billion U.S. dollars) of loans and guarantees to businesses in a bid to support firms getting through the tough times as the coronavirus outbreak escalates in the country.
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