Wednesday

24th Aug 2016

Eurozone slides deeper into recession, Germany grows

  • By far the worst is Greece, whose economy shrunk by 6.2 percent compared to last year (Photo: Travel Aficionado)

Eurozone economies continue to go separate ways, with overall recession of 0.2 percent, while Germany's economy is still growing by 0.3 percent, according to the latest Eurostat data comparing the three months from April to June to the previous quarter.

The so-called flash estimate, which is expected to be confirmed by final data in September, puts the eurozone and the EU as a whole on a declining trend, both having their gross domestic product shrinking by 0.2 percent compared to the first three months of the year.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

When compared to the same period last year, the 17 euro-states fare even worse, with their GDP shrinking by 0.4 percent, while the 27 EU states remain at the same 0.2 percent recession.

Germany's economy grew by 0.3 percent of GDP, while France stagnates. Portugal is shrinking by 1.2 percent, Italy and Spain by 0.7 and 0.4 percent, respectively.

"The flash estimate is in line with markets expectations and our economic forecast," EU commission spokesman Ryan Heath said on Tuesday (14 August) during a press conference.

However he highlighted that the data for the UK is worse than expected, with its GDP shrinking by 0.7 percent compared to the previous three months and by 0.8 percent compared to the same period last year.

By far worse is Greece, whose economy shrunk by 6.2 percent compared to last year.

Heath said this was mainly due to the two rounds of elections and the delays that occurred in implementing the terms of the second bailout.

On Tuesday, the Greek government managed to sell €4 billion worth of three-months bills to its own banks, which in turn had the money from the first tranche of the €130 billion bailout agreed in March.

This will allow Athens to repay a batch of bonds maturing on 20 August and keep the European Central Bank (ECB) lifeline for its banks open.

A mere reshuffling of debt to buy Greece the time needed for the troika of international lenders to write up a key report in September, with the second tranche of €31.5bn not expected until October.

Column / Brexit Briefing

Brexit prompts trade limbo

Brexit has landed EU trade policy, as well as the UK, in limbo land. At least one trade deal has already been put on ice, and others may well follow.

Stakeholders' Highlights

  1. HuaweiMaking cities smarter and safer
  2. GoogleHow Google Makes Connections More Secure For Users
  3. EGBAThe EU Court of Justice Confirms the Application of Proportionality in Assessing Gambling Laws
  4. World VisionThe EU and Member States Must Not Use Overseas Aid for Promoting EU Interests
  5. Dialogue PlatformInterview: "There is a witch hunt against the Gulen Movement in Turkey"
  6. ACCAACCA Calls for ‘Future Looking’ Integrated Reporting Culture With IIRC and IAAER
  7. EURidNominate Your Favourite .eu or .ею Website for the .EU Web Awards 2016 Today!
  8. Dialogue PlatformAn Interview on Gulen Movement & Recent Coup Attempt in Turkey
  9. GoogleA Little Bird Told us to Start Tweeting About Google’s Work Across Europe. Learn More @GoogleBrussels
  10. Counter BalanceThe Trans Adriatic Pipeline: An Opportunity or a Scam in the Making for Albania?
  11. Counter BalanceThe Investment Plan for Europe: Business as Usual or True Innovation ?
  12. Belgrade Security ForumMigration, Security and Solidarity within Global Disorder: Academic Event 2016