A report released on Thursday by several United Nations departments stated that Europe’s debt crisis is continuing to drag down its economy while austerity measures put in place by many European nations have hindered any GDP growth needed to elevate the economy throughout the Eurozone and the European Union.
Furthermore, Europe’s economy shrank in the second and third quarters of 2012, and it is expected that upcoming numbers for the 4th quarter will also show negative GDP growth, indicating that the region has been in what the report calls a “technical recession” in 2012.
2013 and 2014 are expected to have positive growth overall, albeit barely, at 0.5% and 1.4%, respectively.
While all economies throughout the Eurozone have all stagnated and contracted on average, there was and is expected to be more growth in some countries than others. Germany was not in recession in 2013 and is expected to see greater GDP growth in the next two years as compared to the expected average throughout the Eurozone. Conversely, Italy, Cyprus, Greece, Spain, and Portugal are all in recession and may continue in recession throughout 2013.
EU nations Ireland and United Kingdom avoided a much worse recession in 2012 primarily due to increased revenue from the London 2012 Olympic Games; however, GDP still declined slightly over 2012.
In addition, unemployment varied greatly, but followed the same trend as GDP growth. Average unemployment was 11.3% in September 2012, though in Spain and Greece unemployment remained high, above 25%, while in Austria, Germany, Luxembourg and the Netherlands unemployment was around 5%.
Unemployment is expected to increase slightly in all Eurozone nations over the next before dropping over the next two years.
The report “World Economic Situations and Prospects” (WESP) was released by the UN Department of Economic and Social Affairs, the UN Conference for Trade and Development, and five United Nations regional commissions.