According to a recent Eurozone forecast from EY, the Eurozone’s recovery is becoming broader-based and more self-sustaining. According to the report, economic highlights include economic recovery through consumer spending over the last few years and a growing GDP (gross domestic product) of around 1.5 per cent. This may signal productive results moving forward as Europe appears to have stabilised it’s economy during the first few months of 2016. EY further estimates the pace of growth to be more sustainable in the future, with more investment spending and consumer spending as well as expected contributions from government spending. These findings may be of particular interest to those intending to vote in the United Kingdom to leave or stay in Europe.
One key achievement for Europe over recent years may have been the extent to which Eurozone countries have expanded their trade into emerging markets (such as China and Brazil) to achieve growth whilst traditional markets have been contracting. There appears to be many productive aspects surrounding recent findings by EY. For example, the report suggests workers in the European Union countries may benefit from additional labour demand and increased productivity. In addition there may be scope for new employment opportunities should firms see businesses expand further in Europe.
Last month, the European Commission reported higher levels of employment in Europe since August 2011. These recent developments may have influence on the results of the upcoming referendum of United Kingdom staying or leaving Europe, as they suggest Europe’s economy may still be strong and this may have benefits for the United Kingdom by staying together.
The European Union currently consists of 19 countries and uses the Euro as their currency source. The United Kingdom are currently part of Europe however continue to use Pound Sterling currency. Last year, one of the European Union’s top priorities was to strengthen Europe’s competitiveness and to stimulate investment for the purpose of job creation. Throughout 2015, The Commission came forward with proposals for structural reforms and advocated the responsible management of finances. In order to restore investment levels in the EU’s economy, it launched the investment plan for Europe, including new financial instruments in cooperation with the European Investment Bank. There was also the creation of a new fund which contains an initial 21 billion Euros of EU money which is expected to lead to investments 15 times larger. Despite events concerning the ongoing economic and financial situation in Greece, the Commission continues to work towards improving the economy and reducing unemployment. Should the United Kingdom decide to stay in Europe, it is a possibility the country may see many productive aspects from this decision.
Recent European Council meetings continue to focus on current migration levels in Europe as well as the economic situation. The priority areas for 2016 have been highlighted in a recent meeting as re-launching investment, implementing structural reforms to modernise the economies and conducting responsible fiscal policies. In June, the European Council is set to meet to discuss the progress achieved in the work towards completing the Economic and Monetary Union as well as adopting several Agendas for the implementation of the Single Market. Last year, the EU member states began to make progress in rebalancing their economies and carrying out country-specific instructions recommended to them in varying degrees. As each country in the European Union differs in terms of economic strength, it may be important for the Council to provide in-depth reviews with personalised goals depending on the country. It appears the European Council may continue to monitor the economy closely and aim to explore untapped growth and productivity potential for Europe moving forward.
What may be the trickle down effects of growth in the EU economy?