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Europe Daily Bulletin No. 8440
Contents Publication in full By article 11 / 33
GENERAL NEWS / (eu) eu/economy

Commission adopts Spring 2003 Economic Forecasts for the Candidate Countries - growth still on course but uncertainties prevail

Strasbourg, 09/04/2003 (Agence Europe) - Overall Acceding countries and other candidate countries have, on average, sustained solid growth despite the worsened international economic climate. Economic growth has only slightly slowed down during 2002. Due to strong domestic demand, most candidate countries showed resilience and the extent of the slowdown remained limited. These are the main conclusions in the "spring economic forecasts" for these countries that the European Commission adopted on Tuesday in Strasbourg. The outlook for the current and the next year is subject to particularly high political and economic uncertainties. In the current year, growth should amount to 3.1% for the ten acceding economies and 3.5% for all candidate countries. This represents a slight downward revision from the Autumn 2002 forecast. The Commission considers that an expected return to more favourable international conditions should allow to reach average growth of around 4% in 2004 in acceding countries and of 4.3% in all candidate countries. The Commission also notes that lower international commodity prices and weaker growth have contributed to a further fall in inflation in 2002. Higher oil prices and, in some countries, a cyclical recovery should lead to a slight rise of inflation in the current and next year, to levels up to and, in 2004, somewhat above 3% for the ten acceding countries. Over the forecasting period, employment losses due to continued enterprise restructuring should be progressively compensated by higher employment creation and should lead to a slightly improved overall labour market situation up to 2004. Weak export demand should translate in a deterioration of external balances in the current year, which should be reversed in 2004. General government deficits, although set to decline, remain high, as the combined result of lower growth and counter-cyclical fiscal policies in some countries and continued transition-related expenditures over the forecasting period. Full document available on: (http: //europa.eu.int/comm/economy_finance/publications/enlargementpapers_en.htm).

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