EU Commission sees Greek primary surplus at 3.9 percent/GDP in 2018

EU Commission sees Greek primary surplus at 3.9 percent/GDP in 2018

EU Commission sees Greek primary surplus at 3.9 percent/GDP in 2018

With the growth forecast for 2017 slashed by 0.3 percent, it also expects the United Kingdom economy to only grow marginally over the next two years - by 1.3 percent in 2018 and by 1.1 percent in 2019, the year Brexit is now scheduled to happen.

The government debt-to-GDP ratio, which fell below the 60% threshold in 2016, is forecast to decline further to 48.8% in 2019.

"Economic growth and job creation are robust, investment is picking up and government deficit and debt are gradually decreasing", European Commission Vice President Valdis Dombrovskis said, on the occasion of the Autumn forecast.

Malta's treal GDP growth could be pushed by the faster completion of infrastructure projects, as well as by the potential relocation of financial services operators to Malta due to Brexit.

From 2018, the European Commission will revert to publishing two comprehensive forecasts (spring and autumn) and two interim forecasts (winter and summer) each year, instead of the three comprehensive forecasts in winter, spring and autumn that it has produced each year since 2012. It said Italy's GDP is expected to rise 1.5% in 2017, compared to the May forecast of 0.9%, but slow to 1.3% in 2018 (compared to 0.9% predicted previously) and 1% in 2019. "The government deficit is moving closer to balance but risks to the fiscal outlook remain".

Irish growth is close to the top of the European Union league with only Malta (5.6 per cent) and Romania (5.7 per cent) growing faster this year.

Domestic demand was the main driver of growth with both private and public consumption projected to expand strongly in 2017, while last year's "significant contribution" to growth from net exports was set to diminish this year, as imports grew faster than exports, the EC said.

"Consumption growth is projected to be modest, in line with weak real wage growth, while uncertainty continues to weigh on business investment".

Throughout the European Union investment is picking up amid favourable financing conditions and considerably brightened economic sentiment as uncertainty has faded.

The commission said the eurozone had enjoyed its best year since the start of the financial crisis a decade ago, having shaken off the debt crisis that gripped the region a couple of years ago.

Wages are expected to improve as the increase in labour supply slows down. Public finances remain on track to meet the primary surplus targets agreed under the ESM programme.

The European Commission forecasts are slightly more pessimistic than other forecasts for the United Kingdom, but given that so far this year, the United Kingdom grew by 0.3 percent in both the first and second quarters, and by 0.4 percent in the third quarter, they don't seem unduly downbeat.

United Kingdom growth slowed down this year - to 1.5 percent from 2.3 percent in 2015 and 1.8 percent in 2016 - because higher prices led to lower consumption.

The European Commission raised its growth projections for the euro area as domestic demand propels economic growth amid improving labor market conditions and strong global growth.

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