In the first quarter of 2017, the economy of the Eurozone shows a 1.7% growth. In addition, trade figures are growing, and the unemployment rate is falling.
Economist “LC Marco advisors” Lorenzo Kodogniu said that a real revival began in Europe. “Partly because of the increased cooperation with China, the growth in demand from China, while we have the poison of domestic positive factors, including the present improvement in domestic demand, which gives a broader base that is more resistant than in the past.”
EU countries affected by the crisis of 2008 most of all, now have the greatest growth. So, the economy of Portugal beats the record of the last 10 years and shows an annual growth of 2.8%. Spain follows.
Analyst of the Center for European Reforms, John Springford, noted that “we see a cyclical recovery because the European Central Bank (ECB) is finally working and putting into circulation a new money supply.”
Despite all the good things, the unemployment rate in the Eurozone remains quite high and holds at 9.5 percent, although this is less than at the height of the crisis.
The Italian economy does not show stable and steady growth with an annual rate of 0.8%. The reason for this is that Italian banks have not yet moved away from the crisis, political instability remains an important factor.
Greece faced a new wave of recession, where strikes again paralyzed the transport system after the Greek government’s declarations about further cuts in social spending in exchange for new loans from the IMF.
Economists believe that the structural problems that undermine the foundations of the Eurozone have not disappeared anywhere. According to Lorenzo Kodognyu, the Eurozone will not be able to survive without new reforms that envisage further fiscal and political integration.
The share of pessimism in the Eurozone is also contributed by the UK’s decision to leave the European Union, which will lead to a reduction in the EU economy and a reduction in spending. But, John Springford believes that in this situation, first of all, the UK itself suffers, which has a smaller economy than the EU.
An important issue here is the ability of the EU and the UK to conduct successful negotiations in order to reduce the negative mergers from Brexit.
In the EU, the engine of economic growth is considered the re-creation of the Franco-German alliance after Liberal Emmanuel Macron took office. However, a number of reforms of the new president of France may remain unrealized – trade unions promise to create a powerful resistance to liberal reforms in France.