Open

Coming up

Don't miss

Replay


LATEST SHOWS

AFRICA NEWS

Ebola in Nigeria: First death outside of Lagos

Read more

AFRICA NEWS

Niger : Top Oppostion figure to be questioned in baby trafficking scandal

Read more

AFRICA NEWS

Liberia: President dismisses top officials who ignored call back

Read more

MEDIAWATCH

The deleted tweets of Manuel Valls

Read more

DEBATE

How to Stop Ebola: WHO Says Cases Could Exceed 20,000 (part 2)

Read more

DEBATE

How to Stop Ebola: WHO Says Cases Could Exceed 20,000

Read more

WEB NEWS

'Ice Bucket Challenge' angers anti-abortion activists

Read more

#TECH 24

Tomorrow's Transport Today

Read more

FOCUS

Mothers and children leaving Honduras at all costs

Read more

  • French businesses ‘hoping for a new Thatcher’

    Read more

  • UN says 43 peacekeepers captured in Golan Heights

    Read more

  • Peru seizes record 6.5 tonnes of Europe-bound cocaine

    Read more

  • Russian troops have entered Ukraine, says Kiev

    Read more

  • PSG face Barcelona, Ajax in tough Champions League draw

    Read more

  • In pictures: Billions of locusts invade Madagascan capital

    Read more

  • Brad Pitt and Angelina Jolie say ‘I do’ in France

    Read more

  • Erdogan sworn in as Turkey's president

    Read more

  • Assad cannot be partner in fight against terrorism, says Hollande

    Read more

  • New Ebola case in Nigeria brings death toll to 1,552

    Read more

  • Video: 'Neither Baghdad nor the US can defeat the Islamic State'

    Read more

  • Platini will not run against Blatter for FIFA presidency

    Read more

  • Air France pilots announce week-long strike in September

    Read more

  • New French economy minister takes swipe at 35-hour work week

    Read more

  • Uzi shooting by 9-year-old rekindles gun debate

    Read more

  • Mother of American journalist asks IS leader for his release

    Read more

  • UN probe accuses Syrian regime, Islamists of ‘crimes against humanity’

    Read more

  • Uruguayans sign up to grow marijuana at home

    Read more

  • Missouri governor appoints black public safety director

    Read more

Business Europe

Brussels warns of a shrinking economy, rising unemployment

Video by Yuka ROYER

Latest update : 2009-01-19

According to a new forecast by the European Commission, the economies of the 16 eurozone countries will shrink by 1.9% this year amid surging unemployment and government deficits. The jobless rate is expected to top 10% by 2010.

AFP - The economy of the 16 nations using the euro will contract 1.9 percent this year as unemployment surges and government deficits explode in the midst of a severe recession, the European Commission forecast on Monday.
  
The forecast marked a dramatic downward revision from the commission's last estimate in November, when it predicted that eurozone economy would eke out growth of 0.1 percent.
  
The estimate also reveals that the eurozone has rapidly plunged into a deep recession after growing an estimated 0.9 percent in 2008.
  
The commission said the eurozone would not see the beginning of a recovery before mid-2009 and that the eurozone economy would then manage to grow a meagre 0.5 percent in 2010.
  
It forecast that the 27-nation EU economy would fare only marginally better, contracting 1.8 percent this year before achieving growth next year of 0.5 percent.
  
At the same time, unemployment will climb to levels not seen in Europe for over decade as joblessness becomes once again a major headache for workers and politicians.
  
The commission forecast that the eurozone jobless rate due to rise from 7.5 percent in 2008 to 9.3 percent this year and hit 10.2 percent in 2010 -- over the 10 percent mark for the first time since 1998.
  
With their economies in a tailspin, European governments pledged in December to pump a combined 200 billion euros (265 billion dollars) into a Europe-wide economic stimulus package.
  
However, some governments, including that of economic powerhouse Germany, have already come out with plans since then for even bigger stimulus plans or are considering doing so.
  
As governments plow billions into trying to revive their economies and bail out their banks, public deficits will swell, balloning from 1.7 percent of output in 2008 to 4.0 percent in 2009 and 4.4 percent in 2010.
  
However, the commission warned that some countries would see much more dramatic downturns than others, with the financial crisis and housing market crashes taking a heavy toll on the Irish and Spanish economies in particular.
  
Spain will see its unemployment rate surge from 11.3 percent in 2008 to 16.1 percent in 2009 and to a stunning 18.7 percent in 2010 while Ireland will see its deficit explode from 6.3 percent in 2008 to 11.0 percent in 2009 and 13.0 percent in 2010.

Date created : 2009-01-19

COMMENT(S)