The President of the European Commission delivered an encouraging speech on the subject of the eurozone, saying that Europe will not slide back into recession and that the euro continues to be “strong and resilient.”
This speech comes after Standard & Poor’s (S&P) released figures last week that showed Europe’s risk of another recession had grown, forcing them to cut their prediction for European economic growth down to 1.7% for this year, from 1.9%. Manufacturing activity also shrank for the first time in two years this August, all across Europe, with even Germany’s manufacturing section falling into contraction. The service sector managed to eek out small growth, but did not fair much better than the manufacturing sector, landing a blow to the confidence against a double-dip recession.
Still, President of the European Commission Jose Manuel Barroso said in a speech during an official trip to Australia, “We don’t anticipate a recession in Europe. The latest forecast by the European Commission shows there will be growth, modest growth it is true.” He added that “the European Union and euro are strong and resilient.”
Barroso also stated that Europe is “doing all it takes” by “tackling the underlying budget problems,” strengthening official authority throughout the eurozone, and implanting “tougher financial regulation.”
However, when it came to the issue of Greece, Barroso could not speak so decidedly. He stated that it was too early to tell whether or not Greece will meet its goal of cutting the country’s €340billion debt. “We are in contact with the Greek government,” said Barroso, “and just now they have made some important remarks saying that they will comply with their commitments. This is certainly very important for Greece. It is also important for the EU.”
Without a push from Greece, the ‘modest growth’ of 0.2% that the European economy experienced in April to June, may well be a thing of the past. Europe currently treads the finest line between growth and retraction, but is hoping to rally under a “strong and resilient” euro.