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Wed, 05 Nov, 2014 12:00:36 AM FTimes- Xinhua Report, Nov. 05  European Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici (R) and European Commission (EC) Vice-President and Commissioner for Jobs, Growth, Investment and Competitiveness Jyrki Katainen address a press conference on European economic forecasts at the EC headquarters in Brussels on November 4, 2014. Photo AFP-LEHTIKUVA. The European Commission's autumn forecast on Tuesday projected weak economic growth for the rest of this year in both the EU and the euro area.
According to the forecast, all EU countries are set to register positive GDP growth in 2015 and 2016 despite of current slow recovery with very low inflation.
For the next two years, growth in the EU is forecast to rise to 1.5 percent in 2015 and then increase modestly to 2.0 percent in 2016, while in the eurozone, growth is forecast to rise to 1.1 percent and then 1.7 percent respectively, said the report.
Meanwhile, the real GDP growth in the EU this year is now expect to reach 1.3 percent, and 0.8 percent in the euro area as a whole.
The autumn forecast said GDP growth forecasts have been revised down due to lack of the underlying dynamics of domestic demand, particularly investment, which has failed so far to emerge as a strong engine of growth.
Jyrki Katainen, European Commission Vice-President for Jobs, Growth, Investment and Competitiveness, said the economic and employment situation "is not improving fast enough,"adding that the European Commission "is committed to use all available tools and resources to deliver more jobs and growth in Europe."
The EU will put forward a 300 billion euros (about 375.56 billion U.S. dollars) investment plan to kick-start and sustain economic recovery. Accelerating investment is the linchpin of economic recovery, he said.
Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs, said there is no single, simple answer to the challenges facing the European economy.
Moscovici proposed the EU needs to act across three fronts: for credible fiscal policies, ambitious structural reforms and much-needed investment, both public and private.
According to a press release from the European Commission, the EU economic recovery that started in the second quarter of 2013 "remains fragile and the economic momentum in many member states is still weak."
"Despite favorable financial conditions, the economic recovery in 2015 will be slow," said the press release, adding that in 2016, strengthened domestic and foreign demand and a continuation of very accommodative monetary policy associated with low financing costs should further strengthen growth.
The press release said the EU's recovery appears weak, in comparison to other advanced economies and with respect to historical examples of post-financial crisis recoveries, even though these too were typically slow and fragile.
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