News / Europe

Eurozone Economy Faces Another Bad Year

European Economic and Monetary Affairs Commissioner Olli Rehn presents the European Commission spring economic forecasts and outlook expectations for EU member states during a news conference at the EU Commission headquarters in Brussels, May 3, 2013.
European Economic and Monetary Affairs Commissioner Olli Rehn presents the European Commission spring economic forecasts and outlook expectations for EU member states during a news conference at the EU Commission headquarters in Brussels, May 3, 2013.
Lisa Bryant
Hopes that the 17-member eurozone will finally emerge from its economic doldrums this year have faded, with new data Friday showing the recession in the euro area deepening even more than originally expected.

There were some bright spots in a slew of new European economic data, but the short-term prognosis for the 17-nation eurozone is not good. Overall growth is expected to shrink by 0.4 percent this year - deeper than the 0.3 percent forecasted earlier this year. And the eurozone's second biggest economy, France, will slide back into recession.

Businesses and households are also having a hard time accessing credit, putting another brake on economic growth.

One of the most worrying indicators is unemployment - expected to shoot up to an average of 12.2 percent for the eurozone this year, compared to 11.4 percent in 2012. Unemployment for the full 27-member European Union is slightly better, at 10.5 percent.

At a press conference in Brussels, European Economic Affairs Commissioner Olli Rehn cited far more worrying figures for Italy and Spain, where unemployment is expected to peak at an alarming 27 percent this year.

"We must really do whatever it takes to overcome the unemployment crisis. Each EU institution will need to work within its own mandate, each member state, both on its own challenges, and jointly together as a union on our common challenges," said Rehn.

Not all eurozone countries are suffering. Unemployment in Austria is less than five percent. In Germany it's just over five percent. And separate data released Friday showed stronger-than-expected growth in Britain's services sector, an encouraging indicator.

Rehn also was more upbeat for the EU region as a whole.

"We expect the European economy to stabilize in the first half of this year. GDP growth is expected to turn positive in the second half of this year and to gain momentum next year, 2014," said Rehn.

Rehn said demand outside the EU will be the main driver for that growth.

The EU forecast comes a day after the European Central Bank lowered its benchmark interest rate to 0.5 percent, a move many analysts dismiss as insufficient in addressing the eurozone's problems. The ECB has signaled it will be ready to act again, if the need arises.

You May Like

Philippines, Muslim Rebels Try to Salvage Peace Pact

Peace process faces major setback after botched military operation to find terrorists results in bloody gunbattle between government forces, Moro Islamic Liberation Front fighters More

Republicans Expect Long, Expensive Presidential Battle

Political strategist says eventual winner will be one who can put together strongest coalition of various conservative groups that make up Republican Party More

Video New Wheelchair Is Easier to Use, Increases Mobility

Engineers have come up with a lever-operated design that makes use of easily accessible bicycle technology More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Liberia's Almost Last Ebola Patient Grateful but Still Grievingi
X
Benno Muchler
March 26, 2015 3:41 PM
Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video US, South Korea Conduct Joint Military Exercises

The Eighth U.S. Army Division and the Eighth Republic of Korea Mechanized Infantry Division put on a well orchestrated show of force for the media this week during their joint military training exercises in South Korea. VOA’s Seoul correspondent Brian Padden was there and reports the soldiers were well disciplined both in conducting a complex live fire exercise and in staying on message with the press.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.
Video

Video Young Filmmakers Shine Spotlight on Giving Back

A group of student filmmakers from across the United States joined President Barack Obama at the White House this month for the second annual White House Student Film Festival. Fifteen short films were officially selected from more than 1,500 entries by students aged 6 through 18. The filmmakers and their families then joined the president and a group of celebrities for a screening of their films. VOA’s Julie Taboh reports.
Video

Video VOA Exclusive: Interview with Afghan President Ashraf Ghani

Afghan President Ashraf Ghani, during his first visit as president to Washington, gave a one-on-one interview with VOA Afghan Service reporter Said Suleiman Ashna, about his request for a change in U.S. troop levels, the threat from the Islamic State, and repairing relations with the United States and Pakistan. The interview was held at Blair House, late Sunday, in Pashto.
Video

Video California Science Center Tells Story of Dead Sea Scrolls

The ancient manuscripts were uncovered in the mid-20th century, and they are still yielding clues about life and religious beliefs in ancient Israel. As VOA's Mike O'Sullivan reports, an exhibit in Los Angeles shows how modern science is bringing the history of these ancient documents to life.
Video

Video Angelina Jolie Takes Another Bold Step

Hollywood actress and filmmaker Angelina Jolie has revealed she had her ovaries and fallopian tubes removed to lower her odds of getting cancer. Doctors say the huge publicity over her decision will help raise awareness about the importance of cancer screening. VOA’s George Putic has more

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More