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Japan’s extended state of emergency over the coronavirus pandemic is estimated to lead to an economic loss of ¥1 trillion ($9.2 billion), dimming the prospect for a steady recovery toward the end of the year, according to an economist’s forecast.

The government’s decision Friday to expand the areas for the emergency declaration and extend it by about three weeks will have a negative impact of ¥600 billion in addition to the initially estimated ¥400 billion, said Shunsuke Kobayashi, chief economist at Mizuho Securities.

Japan’s third state of emergency took effect on April 25 and slated to end on May 11 but has been extended to the end of May with populous Aichi and Fukuoka prefectures added to join Tokyo, Osaka, Hyogo and Kyoto, which were already placed under the COVID-19 emergency.

Economists expect the Japanese economy to have plunged into negative growth in the January to March period, dragged down by the second state of emergency that was declared in early January and fully lifted in late March.

But the extended declaration could put economic recovery scenarios for the April to June period and beyond “on thin ice,” denting private consumption mainly in the service sector such as restaurants and bars, Kobayashi said.

Yuichi Kodama, chief economist at the Meiji Yasuda Research Institute, said the government could issue more virus emergency declarations and that business investment and consumer spending would be dampened.

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