Europe, the crisis has not ended ” “Unbalances are scary ” “

The Commission's "Economic forecasts" highlight an uphill situation. But some have overcome the obstacle" "

“The economic and employment situation is not improving fast enough”, said, almost timidly, Jyrki Katainen, the reserved Vice-President of the EU Commission from Finland who took office four days ago. He is tasked with coordinating efforts for growth, investment and competitiveness. Almost a “mission impossible” in a “single market” Europe with a stagnating economy, as highlighted in the “Autumn Economic Forecasts” released November 4 at the Berlaymont building. Just in case the message wasn’t clear enough, Pierre Moscovici, Commissioner for Economic and Financial Affairs from France, with a learned, spontaneous speech, added: “There is no single, simple answer to the challenges facing the European economy”.However, not everything is lost. Concrete actions and confidence: this is what counts in the economy. In fact, Moscovici warned: “We need to act across three fronts: for credible fiscal policies, ambitious structural reforms and much-needed investment, both public and private. There was also mention of the “Junker plan” – over which for the moments strict confidentiality prevails – nor of the 300 mln investment package, which, for Brussels, will have to be accompanied by serious solutions that can no longer be deferred, that are the responsibility of EU Member Countries. The “sermon” was followed by the figures, rather discouraging on the whole. The Commission projects weak economic growth “for the rest of this year in both the EU and the euro area”.For 2014, real GDP growth “is expected to reach 1.3% in the EU and 0.8% in the euro area”, while “growth is expected to rise slowly in the course of 2015, to 1.5% and 1.1% respectively, on the back of improving foreign and domestic demand”.An “acceleration” of GDP growth to 2.0%” is expected for 2016. And if “statistics” recovery is projected within two years, this means – as the two commissioners implied – that as for jobs creation we will need to be more patient. The forecast scenario is that of a paradoxical “jobless recovery”, mainly depending on foreign demand. While these are the highlights of the “Autumn forecast” (a bundle of hundreds of pages, tables, percentages, comparisons, charts, power point presentations…), there are at least three specific aspects that must not be underestimated. First: the 28 EU economies march at different speeds. For example, growth rates range from 0.7% in Croatia to 4.6% in Ireland. In-between there are situations of slowdown (Germany, France), some of recovery (Spain, Portugal), while other Countries’ performance is brilliant, including the United Kingdom, Poland and most of Eastern European countries. So the crisis can be faced with different attitudes, with different response capabilities and, most importantly, it is possible to survive. As confirmed in the “Forecasts” – second remark -three of four countries subjected to the much-feared EU “treatment” (namely, sacrifice and rigour), are recovering at full speed. The most interesting case is that of Ireland, with the highest growth rates in Europe; followed by Spain, which in the three-year period is expected to grow from +1.2% to a significant +2.2% in 2016. Then Greece, after this year’s 0.6% is expected to reach +2.9% in 2015, and 3.7% the following year. Thus only Cyprus seems stuck in the stagnating waters of recession. However, this doesn’t mean that the economic, labour and social situation of these countries are blossoming. In fact, there is still a long way to go. On the other hand, we should ask ourselves if the “bitter pills” imposed by the Commission, the ECB and the International Monetary Fund have rescued these countries from failure, thereby preparing the grounds for recovery. The third emphasis regards those States where serious structural problems linger on and that require measures that can no longer be postponed in order to break the chains that are bridling growth: whether it is a serious government debt, an uncontrolled deficit, an inflation below zero, and a poor competitiveness of the system, even linked to excessive taxation or bureaucracy, low job productivity, inadequate credit systems compared to new global markets… reforms can wait no longer. In concrete terms, European Countries and EU institutions will have to take a good look at themselves and identify the best solutions that will trigger an upward trend.

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