BRUSSELS – ANSWER. The outlook for the European economy is better than expected based on this year’s spring forecasts. Commission which were presented yesterday in Brussels, with the responsible Commissioner for Finance Paolo Gentiloni even talk about the “remarkable resilience” of its economy European Union despite strong shocks, mainly due to last year energy crisis. However, as he pointed out, “we must not be complacent” as there are risks such as inflation and banking turmoil. For this reason, he said it was “important to keep the pace of recovery and resilience plans.”

The European Commissioner also noted that in the first quarter of the year it was possible to avoid a recession, while he stressed that the European economy will continue to grow moderately, but also that this growth is “real”. He highlighted the fall in energy prices, noting that they have fallen significantly and will continue to decline, and on the labor market, he stressed that it will remain strong and that wages are expected to rise this year.

On private consumption, Mr. Gentiloni said there would be modest growth as inflation continues to put pressure on purchasing power. At the same time, he did not hesitate to refer to differences between member states, mainly in relation to inflationary pressures, saying that this justified the proposal for a country-by-country approach to fiscal rule reforms, and noted that this could be another incentive complete them by the end of the year.

“We must not be complacent” as risks such as inflation and banking turmoil looming, the finance commissioner stressed.

It should be noted that in its spring forecasts, the Commission revised the growth prospects of the EU. to 1% in 2023, from 0.8% in the winter interim forecast and 1.7% in 2024 (1.6% in winter). For the Eurozone, GDP is expected to grow to 1.1% and 1.6% in 2023 and 2024. Commenting on this, the commissioner said that almost all EU countries will experience growth this year, and in 2024 there will be an increase in economic activity.

As for inflation, Mr. Gentiloni noted that it continues to decline due to the rapid retreat energy pricesbut structural inflation remains high, and this could lead to further tightening of monetary policy by European Central Bank, which consequently affects personal consumption and investment. At the same time, he warned, external risks such as banking unrest and war in Ukraine.

The spring forecasts were detailed at yesterday’s Eurogroup meeting, with much of the discussion focused on the Capital Markets Union (CMU), with Finance Commissioner Paolo Gentiloni saying “our recent proposals to review banking crisis management and the deposit insurance system were an important step . in this direction”. In addition, the use of the digital euro was analyzed in order to strengthen its international role. As Mr. Gentiloni said, “this will facilitate trade relations, reduce risks in exchange rates and lead to the strengthening of our sovereignty.”

Meanwhile, for the first time European Commission assessed the prospects for the Ukrainian economy as a symbolic step after the recent granting of candidate status for EU membership. According to a related report, Ukraine’s GDP is estimated to contract by 29% in 2022 and grow by just 0.6%, but reach 4% in 2024, according to the Commission, despite the fact that the war continues. determining factor in its development.