The EU’s economy is struggling to meet a selection of challenges, the European Commission has found, forcing officials to downgrade the outlook for 2024.
The authority’s Winter Economic Forecast has found that while the EU27 escaped recession at the end of 2023, its momentum was subdued.
Economists now expect the bloc will struggle to perform well over the rest of this year.
New projections have been downgraded, with less than a full percent of growth on the cards for 2024.
The economy may end up struggling even more than expected, with a host of risks looming on the horizon.
The EU Commission has predicted that the EU will only see a modest 0.9 percent growth this year.
The latest prediction has been downgraded from earlier expectations for growth to hit 1.3 percent, marking a reduction of 0.4 percent as risks like war in the Middle East and the phasing out of energy support schemes take shape.
The Euro area has been similarly adjusted, with economists expecting 0.8 percent, down from an originally predicted 1.2 percent. The bloc is expected to recover through the year, but the next major pick-up may not come until 2025.
European Commissioner for Economy, Paolo Gentiloni, said: “The European economy has left behind it an extremely challenging year, in which a confluence of factors severely tested our resilience.
“The rebound expected in 2024 is set to gradually pick up pace on the back of slower price rises, growing real wages and a remarkably strong labour market.”
Next year, the EU is predicted to see 1.7 percent growth, a rate that is so far unchanged from the autumn forecast offered in 2023.
The Euro area’s prospects for the same period have been downgraded, but only slightly, from 1.6 to 1.5 percent.
The EU’s situation for 2024 has been improved slightly as the bloc escaped recession in 2023, something the UK wasn’t lucky enough to avoid, with recent figures showing the economy started receding at the end of last year.
Britons cut their spending last year, meaning the economy shrunk by 0.3 percent between October and December.
The contraction was the second of 2023, with economists having identified the first between July and September.
The lower activity meant that, for the whole of 2023, the UK’s economy only grew by 0.1 percent.
