Eurozone on growth course
February 25, 2014
Marking a difference from the gloom of the crisis years, the EU executive on Tuesday slightly upped its growth prediction for the eurozone economy for this year, saying the area's combined gross domestic product would increase by 1.2 percent in 2014, up from a 1.1 percent growth forecast last fall.
Brussels said the upward revision was powered chiefly by a 1.8 percent jump expected for Germany. The Commission penciled in 1 percent growth for France, and only a meager 0.6 percent for the bloc's third-largest economy, Italy, with its new Prime Minister, Matteo Renzi, facing the challenge of turning around the economic fortunes of his country after a long spell of political turmoil.
"Recovery is gaining ground as the worst of the crisis may now be behind us," Economy Commissioner Olli Rehn said in a statement.
Heterogeneous picture
The figures drew a clear dividing line in the eurozone between southern countries such as Greece and Cyprus, who are struggling economically and hoping to be allowed to spend more soon in a departure from harsh austerity measures, and Germany, which is going from strength to strength because of high export volumes and budget consolidation.
The EU's forecast also outlined just how much the continent still lagged behind the US economy, which was expected to expand by around 3 percent in 2014.
The report also echoed a conviction voiced by the European Central Bank saying that there was only a marginal danger of a protracted deflation, with the eurozone predicted to log a 1 percent increase in consumer prices this year, followed by a 1.3 percent hike in 2015.
hg/dr (AFP, Reuters, dpa)