The EU Commission expects the economic output of the 27 member states to decline by 7.4 percent in 2020. The Brussels authority thus corrected its economic forecast for the summer slightly upwards.
Brussels – The EU Commission does not expect a quick economic recovery after the coronavirus crisis. The second wave of new infections is currently causing even more uncertainty, said Commission vice Valdis Dombrovskis on Thursday in Brussels. That dims hope for a quick recovery. “The economic performance of the EU will not reach the pre-crisis level again before 2022.”
In the Commission’s autumn forecast that has now been presented, the estimates for 2020 have been increased slightly, but decreased slightly for 2021. Specifically, a historical slump in economic output of 7.4 percent is expected in the EU this year. In 2021 it should then go up by 4.1 percent, in 2022 by 3.0 percent. For the euro zone, a minus of 7.8 percent is expected this year, then an increase of 4.2 percent in 2021 and 3.0 percent in 2022.
These countries are hit particularly hard
The heavyweights France, Italy and Spain are particularly hard hit by the pandemic. For Spain, the commission predicts the biggest fall of 12.4 percent this year. Germany should do comparatively well. The minus should be 5.6 percent in 2020. Growth of 3.5 and 2.6 percent is then estimated for 2021 and 2022.
The labor market is not expected to ease again until 2022. While the unemployment rate in the EU was 6.7 percent in 2019, the forecast is now 7.7 percent for 2020 and 8.6 percent for 2021. It should then decrease to 8.0 percent in 2022. At the same time, debt is expected to rise sharply because the tax authorities are losing tax revenue and the corona aid leads to immense special expenses. After the budget deficit in the euro zone was 0.6 percent in 2019, it will be 8.8 percent in 2020. Declines are then expected in 2021 and 2022.