In its Spring Economic Outlook 2020, BusinessEurope’s central forecast is for the EU economy to fall by 7.9% in 2020, and rebound with 5.8% growth in 2021. This implies that the economy will be operating just slightly below its pre-crisis level towards the end of 2021.
BusinessEurope’s Director General Markus J. Beyrer said: “Our analysis shows that by ensuring the right policy mix, including a co-ordinated EU-wide fiscal stimulus, focussed particularly on growth-enhancing investment, we can help return output more quickly to pre-crisis levels, protect more jobs and reduce long-term damage to our business eco-system.”
The report highlights that the depth of the recession and the strength of the ensuing recovery may differ considerably between member states depending on the duration and intensity of lockdowns. Sectoral differences, including the greater reliance on international tourism in some member states will also impact recovery paths.
The report notes that EU stimulus through actual direct revenue and expenditure has been relatively small in relation to G7 economies like the US, Japan and Germany and concludes that “we urgently need to deliver a co-ordinated EU fiscal stimulus matching the magnitude seen in other G7 economies”.
See the full document here.