The EU’s gross domestic product (GDP) is expected to grow 3.7% in 2021 and 3.9% in 2022, according to the European Commission’s winter economic forecast released on Thursday.
In its regular economic forecast for the European Union of 27 and the 19 countries using the euro, the EU executive said the short-term outlook for the EU economy appeared weaker than expected l last fall, as the pandemic continues to weigh on the continent. .
Highlighting the more contagious variants of the coronavirus and the negative impact of the new containment measures on economic activity, he said the EU economy started 2021 on a weak basis.
However, he added, “as vaccination campaigns gain momentum and pressure on health systems [starts] subside, containment measures should gradually ease. “
This will eventually lead to a resumption of growth, “still moderately in the second quarter, but more vigorously in the third, driven by private consumption with additional support from world trade”.
The economy is expected to return to pre-crisis production levels earlier than forecast in previous forecasts, largely due to stronger momentum in the second half of 2021 and into 2022.
“The speed of the recovery will vary considerably across the EU, however,” he said, adding that some EU economies contracted more than others during the pandemic.
Inflation should be slightly higher
Inflation in the EU is expected to be slightly higher in 2021 compared to last fall, but to remain contained, but with a temporary improvement compared to base effects, according to the report.
“In the euro area, inflation is expected to drop from 0.3% in 2020 to 1.4% in 2021 before slowing down slightly to 1.3% in 2022.”
He said all projections are limited by significant uncertainty and high risks, depending on how the pandemic progresses and the success of vaccination campaigns.
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