LONDON – The European Commission has more negative outlook on its outlook for the eurozone economy, forecasting a decline in the rate of expansion for the region by 2021 as governments deal with new variants of the coronavirus.
The Brussels-based region expects the 19-member region to grow by 3. 8% this year, and in November forecast a GDP (gross domestic product) rate of 4. 2% by 2021.
The latest forecasts come at a difficult time for the European Union, as the deployment of its Covid vaccine faces production, source and documentation problems. At the same time, European governments are involved in mutations in the virus that are considered more contagious. The longer the fitness emergency, the more EU countries will have to make greater social restrictions and closures, which has a negative effect on the economy.
In statements to CNBC on Thursday, EU Commissioner for Economic Affairs Paolo Gentiloni said: “We are still in a difficult winter with closures and restrictive measures underway across Europe. “
The European Commission’s forecasts assume that social restrictions will be eased at the time of the 2021 quarter, but that sectoral measures will nevertheless still be in place in 2022.
In the future, the European Commission expects euro area GDP in 2022 to succeed by 3. 8%, after projecting a GDP rate of 3% for next year in November.
For individual countries, Germany is expected to grow by 3. 2% in 2021, after contracting by 5% in 2020, while France, meanwhile, will see a GDP rate of 5. 5% this year, after falling more than 8% in 2020.
The European Commission is committed to vaccinating 70% of the adult population during the summer, although deployment also depends on the Member States.
“We are fully committed to making each and every effort to drive plans, the production capacity of vaccines that are already approved,” Gentiloni told CNBC, adding that additional vaccine approvals are expected in the coming months.
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