| dc.description.abstract | The Autumn forecasts for 2011-2013 published by the Commission on 10 November 2011 show that economic recovery has come to a standstill and that low levels of confidence are adversely affecting investment and consumption. This lack of confidence is due to the negative feedback between the sovereign debt crisis and the situation in the financial sector together with a slowdown in the global economy. The impact has been particularly acute in the Euro area. As a result, GDP is likely to stagnate in the coming year and overall growth in the EU is forecast to be as low as 0.6% for 2012. Unemployment levels are likely to remain high at around 10% in 2012 and into 2013, exacerbating the social impact of the crisis. Without a convincing response to the crisis in the Euro area the economic outlook for the whole of the EU will deteriorate rapidly. The growth prospects of all Member States, whether they are currently in the Euro area or not, depend on dealing decisively with the sovereign debt crisis and demonstrating that the Euro is a stable and strong currency whose members are determined and capable of implementing sound economic policies. Given the risk aversion in financial markets, these issues are not yet settled. This prolonged period of uncertainty needs to come to an end. As the decisions of the European Council and the Euro area Summits have repeatedly shown, and most recently on 26/27 October 2011, EU leaders are prepared to do whatever it takes to resolve the current crisis – even to the point of considering the need for further Treaty change. While understandable and necessary, too much political time and energy is being spent on emergency measures and not enough time is being devoted to implementing the policy changes that will bring our economies back to higher growth levels. |
