EU forecasts moderate growth in 2014

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The European Union predicted on Monday a positive economic outlook for the next two years, but with one condition: EU member states must stick to the agreed austerity measures.

According to the Commission’s Spring economic forecast, 2014 will see GDP grow by 1.6% in the EU and 1.2% in the euro area, with even further improvements in 2015.

‘Since the EU economy came out of recession a year ago, the economic outlook remains favourable. The recovery is gaining traction including in vulnerable countries. The policies implemented in recent years are bearing fruit. Investment is rebounding while unemployment remains high in many member states. We expect some improvement in the next years.’ said EU Commissioner for Transport and Economic and Monetary Affairs and the Euro Siim Kallas.

With several countries still in recession, Kallas also pointed at the substantial differences in GDP, unemployment and investment rates between EU countries.

While unemployment remains very high and growth moderate for southern countries like Spain, things are looking better for Germany.

‘Among the larger economies; a steady expansion driven by domestic demand is expected in Germany. The economy of the Netherlands has turned the corner with growth set to be driven by investment this year and in 2015 also by rising household consumption.’ said Kallas.

The unemployment rate is forecast to decrease slightly this year. In 2015, it is set to stand at just over 10% in the EU.

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