EU forecasts mild economic growth, warns of high unemployment

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‘Recovery in the European Union is gaining ground’. With this message, EU commissioner Olli Rehn launched the bloc’s winter economic forecast, showing higher growth in Europe than previously expected.

Speaking at the European Parliament on Tuesday, Rehn said that the 18 eurozone countries would grow by 1.2% this year and 1.8% in 2015.

But warning that signs of recovery are still ‘modest’, Rehn also highlighted that unemployment across the bloc remains too high.

“All EU economies are expected to be growing again by next year. All in all, the worst of the crisis may be behind us, but this is not an invitation to be complacent.”

“Recovery in the European Union is gaining ground and spreading across countries, although it remains still modest. It is good news that economic activity has also started to strengthen in the vulnerable countries. The differences in growth rates between countries are projected to narrow in this period of 2014-2015.” said EU Economic and Monetary Affairs Olli Rehn.

While the Commission insists that the eurozone is gradually recovering from its worst crisis in decades, MEPs criticized that the current economic reform policies are increasing inequalities across Europe.

“Mr Rehn we are all for the Semester and coordination of economic and social policies across Europe . The Semester is an essential tool, but it is targeted solely to two objectives, reducing public spending and the cost of labour and that means reducing incomes and the social protection. Do you think seriously that is going to get us out of the crisis?” said French Green MEP Philippe Lamberts.

“How can we speak of improvement when Growth in 2013 was 0.0% ? and with 27 million unemployed people in Europe, one out of 5 young people are unemployed, can we speak of improvement Mr Barroso when we have 24% of Europeans homes on the verge of the poverty line and social exclusion? Can we speak of recovery when after investing 500 billion euros in the European financial system, credit is still almost unavailable or at a very high rate? NO Mr Barroso.” said Spanish S&D MEP Sergio Gutierrez Prieto.

According to the Commission, a steady expansion driven by domestic demand is expected in Germany, but France, the Netherlands and Italy will only see a mild economic recovery.

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