The two major economic engines are sluggish, and the European economic recovery is struggling

Mondo Finance Updated on 2024-02-29

The internal and external environment of the European economy lacks positive energy, and the economic growth trend is struggling. Due to the sluggish performance of the two major economic engines of Germany and France, the overall recovery of the European economy continues to be weak. According to the EU institutions, the key drawback at present is that "Europe's own money cannot serve the European economy", and the instability of internal and external markets and various uncertainties are also hindering Europe's ability to revitalize its funds. From the perspective of the external environment, under the coercion of the United States, the EU is gradually stepping on the edge of the protectionist swamp of decoupling from some economies. Europe's economic recovery requires the protection of development sovereignty.

Entering the new year, the economic recovery in Europe has not shown a new look. Due to the sluggish performance of the two major economic engines of Germany and France, the overall recovery of the European economy continues to be weak. In the latest economic ** report released by the European Commission recently, the economic growth forecasts of the EU and the euro area have been lowered this year. Although the inflation level that has plagued the European economy for a long time has declined, which has reduced the risk of a technical recession for the European economy to a certain extent, due to multiple uncertainties, it seems that EU institutions will not be able to "live" money for a while, and the prospects for recovery are not easy.

According to the European Commission's recent Winter Economy** report, the economic growth outlook for the EU and the eurozone is likely to remain weak in 2024. Compared to the previous quarter's economic analysis, the European Commission put the EU economic growth rate from 13% to 09%, the eurozone economic growth rate increased from 12% to 08%。It has been observed that in addition to the obvious restraining effect on economic growth caused by the continuous and sharp tightening of fiscal policy in the past, the important reasons for the continued weakness of the European economy also include the decline in domestic household consumption and market stability. In other words, the internal and external environment of the European economy lacks positive energy, and the economic growth trend is struggling.

In the process of thinking about how to boost household consumption, the EU institutions believe that the key problem at present is that "Europe's own money cannot serve the European economy". During the recent informal meeting of eurozone member states in Ghent, Belgium, ECB President Christine Lagarde listed a set of figures for countries: there are currently about 250 billion euros, or 1. % of Europe's nominal GDP8% is flowing from European countries to the United States, as a way to explain "where has the euro gone". In addition, Lagarde said that just to meet the goal of reducing Europe's greenhouse gas emissions by 90% by 2040, the EU faces a funding gap of about 800 billion euros a year.

Europeans have money but don't want to spend it. Bruno Le Maire bluntly said that "Europeans' savings are sleeping". Le Maire pointed out that the total savings of European residents are currently as high as 35 trillion euros, and a large amount of money has been "sleeping" in bank accounts, and the huge amount of money that should be used to contribute to European economic growth, research and employment can only play a small role in the statistics of savings.

In addition, the instability of internal and external markets and various uncertainties are also important factors restricting Europe's ability to revitalize its funds. During this year, the European Parliament and a number of member states will face elections, potential institutional changes will have an impact on the geopolitical ecology inside and outside Europe, the EU and its member states' domestic and foreign policy considerations may also face a series of adjustments, the continued economic downturn will certainly exacerbate voters' disappointment, this sentiment will also react to the next series of elections, so it is not excluded that there will be unexpected changes in the economy, climate change, immigration, energy and other policies closely related to the market, some local ** Investment and financing plans are faced with the choice of "votes" or "development". At the same time, the United States**, far across the Atlantic, will also affect the European market. At present, with the rise of far-right parties in France, Germany, Austria, the Netherlands and other countries, the EU will inevitably face more disagreements on a series of development issues in the future, and it is not surprising that there is "money but not spending".

Some local European analysts believe that the key to ensuring the resilience of the European economy lies in whether Brussels can insist on independence and self-determination. Previously, under the coercion of the United States, the EU gradually stepped on the edge of the protectionist swamp of decoupling from some economies, and broke the development balance of "technological superiority + global market", but at the juncture of "self-abandonment" in Europe in order to follow its allies, the United States "Inflation Reduction Act" that insisted on defending economic and trade hegemony happened to be introduced, which accelerated the outflow of European industry and capital, causing its economic recovery to fall into trouble. From this point of view, the European economy, which continues to recover sluggishly, really needs more positive energy to protect development sovereignty.

*:Economy**.

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