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Europe Daily Bulletin No. 8841
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GENERAL NEWS / (eu) eu/oecd/economy

OECD economic forecasts see strengthened growth in 2005 despite uncertainty linked to oil prices

Brussels, 03/12/2004 (Agence Europe) - The rationalised figures for growth, published by the ECB on Thursday (EUROPE of 3 December, p.11) are in line with the latest economic forecasts of the Organisation for Economic Cooperation and Development (OECD). Although the range of growth for 2004 and 2005 have been reviewed downward by the European Central Bank, the analysis by President Trichet and that of OECD experts converge on the possibility of the economy gradually picking up over the next two decades, but there is a gloom cast on this by oil prices. OECD growth estimates for 2004 and 2005 in the euro zone are 1.8% and 1.9% respectively, exactly the average figure announced on Thursday by the ECB. In 2006, they were up a little, to 2.5% compared to 2.2% for the ECB.

Confidence of households is a common concern for the world economy, Jean-Philippe Cotis, OECD Chief Economist, notes. The United States continues its "sustained" progression, the Asian countries are slowing down albeit "from a very strong growth base", while Europe "is struggling to pick up speed". Mr Cotis considers, however, that "despite recent turbulence caused by oil prices, the global economy will gain renewed vigour in a reasonably near future". Pushed by the favourable outlook in the United States, world growth will also be stimulated by the dynamism of the Asiatic zone, with China in the lead but also Japan, despite a pause in its activity in recent months. For Europe, the prospects seem less clear and it is not sure whether it will be "able to make its own contribution" despite a surge in demand.

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