Brussels, 25/04/2001 (Agence Europe) - On Wednesday, the European Commission published the economic forecasts for the candidate countries (2001-2002), announcing sustained progress in their activity in 2001-2002, despite a less fouvourable economic environment. Growth in the Thirteen, which was 4.6% in 2000, is forecast at 4% in 2002. Commissioner Pero Solbes, responsible for economic and monetary matters, spoke of "reasonable growth" and "relative stability", adding that the candidate countries were subject to the same risks as EU Member States, their main trading partners.
The major exception to this progress is Turkey, for which prospects have become highly uncertain following the two banking and financial crises of November 2000 and February 2001. In 2000, for the first time since the beginning of the transition period, all candidate countries recorded positive growth. It remained modest in Romania, Slovakia, Lithuania and in the Czech Republic, which are emerging from a period of recession or suffering the effects of austerity measures. The highest rates of growth were recorded in Estonia, Latvia, Bulgaria and Hungary. Although inflation has accelerated in most of these countries, mainly due to the steep rise in oil prices, the recent fall in the price of crude should slow down this trend. Inflation should thus go from 27.6% in 2000 to 29% in 2001 and fall to 15.3% in 2002. Sustained growth should gradually reduce unemployment, even though the level remains high at 11.5% for the Thirteen in 2001-2002. This is one of the main political challenges of many candidate countries.
In addition, public deficits (-5.9% in 2001) and the trade balance (-6.8%) remain high and variable. Mr. Solbes declared that "they will not rapidly fall to the EU's average level". In 2000, almost all candidate countries recorded economic results slightly superior to the nevertheless optimistic forecasts announced by the European Commission in the autumn, except for Poland, where one can observe a slackening off of domestic demand from the third quarter. The Commission urges candidate countries to set at the top of their priorities the consolidation and reinforcement of the financial sector, which means an improved surveillance and monitoring framework.
This is the second time that the European Commission has carried out this forecasting exercise for the candidate countries. It draws attention to the fact that the results are not very detailed, due to the difficulties in securing complete data.