• Gentiloni on the Recovery Fund: "Received the drafts from Italy"

  • EU, Gentiloni: "Recovery interrupted by virus resurgence, growth stops"

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11 February 2021 The European Commission revises upward the estimates on the Eurozone economy for 2020, but files the expected rebound for the current year. 



In fact, the EU estimates a contraction of 6.3% for the Eurozone in 2020, followed by a rebound equal to + 3.7% for 2021 and + 3.9% for 2022. This is what the European Commission says in the its winter economic forecasts.

In the autumn, the Brussels executive estimated a decline of 7.8% for 2020 followed by a rebound to + 4.2% in 2021 and + 3% on 2022. 



Gentiloni:

pre-crisis levels in 2022 but not for all

"Given that the recession in 2020 was not as deep as expected, and thanks to vaccines, the EU is expected to reach the pre-pandemic growth levels it had in the fourth quarter of 2019, already in the second quarter of 2022, sooner than what expected last autumn. But one in four will need more time. Furthermore, no member state will return in 2022 to the growth projections it had before the crisis ", said Paolo Gentiloni, EU Commissioner for Economy, during the presentation of the winter economic forecasts. 



"This forecast - continued the former premier - assumes that the current strict containment measures will ease towards the end of the second quarter and then more markedly in the second half of the year, when the most vulnerable and a quota growing adult population ".



Although Europe remains "in the grip of the pandemic" with the new wave and the variants that have forced new containment measures, the EU Commission sees "light at the end of the tunnel" thanks to the launch of vaccination programs that "give reason for a cautious optimism ".



Recovery interrupted by virus resurgence

"After the worst recession in the history of the EU, which hit us during the first half of the year, and the strong recovery recorded in the summer, Europe's recovery was interrupted due to the resurgence of cases of Covid-19 ".

"Growth will return in 2021, but it will take two years before the European economy can reach a level close to that before the pandemic." 



"In the current context of a very high degree of uncertainty, national economic and fiscal policies must continue to support the recovery, while the Next Generation Eu instrument must be finalized by this year and effectively implemented in the first half of the year. of 2021 ", added Gentiloni.



"In the autumn we predicted that the Recovery fund could have a 2% impact on GDP in the years it will be operational. States that have a GDP per capita below the EU average will have the strongest push. Considering a six-year stimulus , the 2021-2026 GDP level could be 3% -3.5% higher than in a no recovery scenario, "said the Commissioner for the Economy.



GDP estimate in Italy improves

The European Commission estimates that Italian GDP in 2020 will measure a contraction of 8.8% compared to the -9.9% forecast in November (-9% planned by the government).

In 2021, the recovery is expected to reach 3.4% (previous estimate 4.1%, government 6%);

in 2022 3.5% (previous estimate 2.5%, government 3.8%). 



According to the Brussels economists, the inflation rate after -0.1% in 2020 will return to positive territory at 0.8% this year and 0.9% next year, with a gap of 0.6 in these two years % and 0.4% compared to the estimated Eurozone rate of 1.4% and 1.3% respectively.