Saying the road to recover is “still paved with uncertainty,” the European Union's economy minister Tuesday said the EU’s economy will shrink more in 2020 and recover less in 2021 than originally forecast.
European Commissioner for Economy Paolo Gentiloni speaks during a media conference on the summer 2020 economic forecast at EU headquarters in Brussels, July 7, 2020.
At a Brussels news conference, EU Economy Commissioner Paolo Gentiloni told reporters the COVID-19 pandemic has hit the European economy harder than previously expected and he is predicting the grouping of 19 EU nations that use the euro as their currency will see a record decline of 8.7% this year, and growth of 6.1% in 2021.
In May it had forecast a 7.8% decline this year, and growth of 6.3% in 2021.
The pandemic prompted businesses to shutter, travel between nations to stop and citizens to stay home in most European nations. Gentiloni said the lifting of lockdown measures is proceeding at a more gradual pace than assumed in their May forecast.
He said the forecast suggests France, Italy and Spain, among the nations hit worst by the pandemic, will see the most severe economic contraction, while Germany, the Netherlands and Poland will see milder economic downturns.
Gentiloni said lack of a “Brexit” deal with Britain would leave its trade status with the grouping uncertain, and “would be negative outcome for both sides, though particularly negative for the U.K."