Eurozone faces even deeper recession

Brussels, The European Commission expects gross domestic product (GDP) to contract by 8.7 percent in the eurozone this year, according to its latest forecast, significantly deeper than the 7.7 percent decline predicted in May.

 

In 2021, the 19-country currency area should brace for a “slightly less robust” recovery than previously modelled, at 6.1 percent growth, according to a statement from the commission, Deutsche press agency (dpa) reported.

 

For the whole 27-member European Union, a GDP downturn of 8.3 percent is forecast in 2020, followed by a return to growth at 5.8 percent next year.

The forecast updates the grim picture of the bloc’s economic health following months of Covid-19 containment measures that saw shops, restaurants and hotels shuttered. Many of these measures have been gradually lifted in EU countries.

 

According to the EU’s executive arm, “early data for May and June suggest that the worst may have passed.” However, the forecast is predicated on the assumption there is no major second wave of coronavirus infections.

 

Source: Bahrain News Agency