The economic outlook has improved for the euro zone, according to the European Commission’s latest forecasts on Wednesday, but the institution warned that the delta variant is a “stark reminder” that the pandemic is not over.
The executive arm of the EU had projected in May a 4.3% GDP rate for the euro area in 2021, followed by a 4.4% GDP rate in 2022. Now, the commission has updated its forecasts and is expecting a 4.8% growth rate this year, and 4.5% for 2022.
In comparison, the European Central Bank said in June that the euro area should grow 4.6% in 2021 and 4.7% next year.
“The EU economy is set to see its fastest growth in decades this year, fueled by strong demand both at home and globally and a swifter-than-expected reopening of services sectors since the spring,” Paolo Gentiloni, the EU commissioner for the economy, said in a statement.
Based on the latest forecasts, the commission expects the euro area to return to its pre-crisis levels in the last quarter of this year — meaning one quarter earlier than expected.
However, Gentiloni also said: “Crucially, we must redouble our vaccination efforts, building on the impressive progress made in recent months: the spread of the Delta variant is a stark reminder that we have not yet emerged from the shadow of the pandemic.”
