European Economic Forecast: extracts from the press conference by Olli REHN, Vice-President of the EC in charge of Economic and Monetary Affairs and the Euro

Type: NEWS   Référence: 92978   Durée: 00:03:02   Première transmission: 22/02/2013  Lieu: Brussels, Belgium - EC
Fin de production: 22/02/2013
On 22 February, Olli Rehn, Vice-President of the EC in charge of Economic and Monetary Affairs and the Euro, presented the European Economic Winter forecast 2012-14. While financial market conditions in the EU have improved substantially since last summer, economic activity was disappointing in the second half of 2012. However, leading indicators suggest that GDP in the EU is now bottoming out and we expect economic activity to gradually accelerate. The pick-up in growth will initially be driven by increasing external demand. Domestic investment and consumption are projected to recover later in the year, and by 2014 domestic demand is expected to take over as the main driver of strengthening GDP growth. The weakness of economic activity towards the end of 2012 implies a low starting point for the current year. Combined with a more gradual return of growth than earlier expected, this leads to a projection of low annual GDP growth in 2013 of 0.1% in the EU and a contraction of -0.3% in the euro area. Quarterly GDP developments are somewhat more dynamic than the annual figures suggest, and GDP in the fourth quarter of 2013 is forecast to be 1.0% above the level reached in the last quarter of 2012 in the EU, and 0.7% in the euro area. The contrast between the improved financial market situation and the muted macroeconomic prospects for 2013 is to a large extent due to the balance-sheet adjustment process, which continues to weigh on short-term growth. As this process advances, it will also strengthen the basis for growth in 2014, which is projected at 1.6% in the EU and 1.4% in the euro area.

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00:00:00 Title 00:00:05
00:00:05 Exterior of the EU Commission building (2 shots) 00:00:11
00:00:16 General view of press conference 00:00:04
00:00:20 SOUNDBITE (in English) Olli Rehn, Member of the EC in charge of Economic and Monetary Affairs: The ongoing rebalancing of the European economy is continuing to weigh on growth in the short term. The current situation can be summarised like this: we have disappointing hard data from the end of last year, some more encouraging soft data in the recent past, and growing investor confidence in the future. The decisive policy action undertaken recently is paving the way for a return to recovery. We must stay the course of reform and avoid any loss of momentum, which could undermine the turnaround in confidence that is underway, delaying the needed upswing in growth and job creation. 00:00:57
00:01:17 General view of press conference 00:00:06
00:01:23 SOUNDBITE (in English) Olli Rehn: Next, the financial market and the current conditions. Since summer 2012 the financial market conditions in the EU have improve substantially thanks to decisive policy actions. The progress on fiscal consolidation and the structural reforms undertaken in Member States supported by the ESM, now operational and by the ECB's decision on outright monetary transactions. 00:00:43
00:02:06 Cutaway of journalists 00:00:05
00:02:11 SOUNDBITE (in English) Olli Rehn: The unemployment rate in the EU amounted to 10.5% and in the euro area, 11.4 % last year, which unfortunately marks large differences between Member States. This reflects the large adjustments challenges that some Member States are still undergoing. Employment t is expected this year to fall by 0.4%. And for 2014, we expect a rebound by 0.5% in the EU. 00:00:47
00:02:58 General view of press conference 00:00:04
00:03:02 End 00:00:00
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