European Union to come out of recession this year
The European Union on Tuesday said the region's economy will climb out of recession this year, on the back of improving financial conditions, even as the outlook for future growth remains uncertain.
By PTI |
LONDON: The European Union on Tuesday said the region's economy will climb out of recession this year, on the back of improving financial conditions, even as the outlook for future growth remains uncertain.
Hit hard by the financial meltdown, many of the European economies slumped into recession. The region is also grappling with soaring unemployment numbers.
"The EU economy will emerge from recession in the second half of this year, although for 2009 as a whole, GDP is still set to fall by some four per cent.
"A gradual recovery is expected with GDP forecast to grow by 0.75 per cent in 2010 and around 1.50 per cent in 2011," the European Commission, the executive arm of the 27- nation EU said.
The near-term rebound in economic activity is spurred by better external environment and financial conditions in addition to fiscal and monetary policy measures.
"The outlook for the EU economy as it emerges from recession is highly uncertain, and subject to non-negligible but broadly balanced risks... the impact of weak labour-market conditions and constraints on investment could prove stronger than expected," EC said in a statement.
Painting a gloomy picture for the labour market, jobless rate is projected to touch 10.25 per cent in coming months.
Further, EU's public deficit is estimated to be 7.50 per cent of GDP in 2010, before falling back slightly in 2011.
"The EU economy is coming out of recession. This owes much to the ambitious measures taken by governments, central banks and the EU that have not only prevented a systemic meltdown but have kick-started the recovery," Commissioner for Economic and Monetary Affairs Joaquin Almunia said.
Noting that the road ahead is a challenging one, Almunia said there should be a complete repair of the region's banking system to ensure a sustainable recovery.
Fighthing the raging financial turmoil, the global economy is slowly seeing signs of revival, with advanced economies, including the US, Japan, Germany and France exiting recession.
The US economy expanded 3.5 per cent in the third quarter of 2009, recording growth for the first time in a year.
Hit hard by the financial meltdown, many of the European economies slumped into recession. The region is also grappling with soaring unemployment numbers.
"The EU economy will emerge from recession in the second half of this year, although for 2009 as a whole, GDP is still set to fall by some four per cent.
"A gradual recovery is expected with GDP forecast to grow by 0.75 per cent in 2010 and around 1.50 per cent in 2011," the European Commission, the executive arm of the 27- nation EU said.
The near-term rebound in economic activity is spurred by better external environment and financial conditions in addition to fiscal and monetary policy measures.
"The outlook for the EU economy as it emerges from recession is highly uncertain, and subject to non-negligible but broadly balanced risks... the impact of weak labour-market conditions and constraints on investment could prove stronger than expected," EC said in a statement.
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Painting a gloomy picture for the labour market, jobless rate is projected to touch 10.25 per cent in coming months.
Further, EU's public deficit is estimated to be 7.50 per cent of GDP in 2010, before falling back slightly in 2011.
"The EU economy is coming out of recession. This owes much to the ambitious measures taken by governments, central banks and the EU that have not only prevented a systemic meltdown but have kick-started the recovery," Commissioner for Economic and Monetary Affairs Joaquin Almunia said.
Noting that the road ahead is a challenging one, Almunia said there should be a complete repair of the region's banking system to ensure a sustainable recovery.
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Fighthing the raging financial turmoil, the global economy is slowly seeing signs of revival, with advanced economies, including the US, Japan, Germany and France exiting recession.
The US economy expanded 3.5 per cent in the third quarter of 2009, recording growth for the first time in a year.
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