Sunday

5th Dec 2021

Euro zone could outstrip US by 2010

A new report by the world's largest financial services firm, PricewaterhouseCoopers (PwC), projects that the Eurozone economy could grow faster than the US by 2010.

PwC's European Economic Outlook - published today - concludes that although growth in the Eurozone is likely to remain sluggish in the next two years, there is "the potential to achieve faster GDP per capita growth than the US over the rest of this decade".

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

  • The EU can catch up with the US ... but only after "urgent reforms". (Photo: EUobserver)

The projection will give a much needed boost to advocates of the "Lisbon process", which aims to make the EU the "most competitive economy in the world by 2010". Critics have long held that Europe is unlikely ever to outpace the US.

But there is a catch.

The report goes on to say, "however, this can only happen if the Euroland countries make effective reforms in areas such as pensions and labour markets".

There are some signs that the reform process is moving forward in Germany, but reforms to pensions remain highly controversial - as the Prime Ministers of France and Italy have found.

And not only does the Euro zone have to get its act together to outpace the US, the US also has to experience economic instability itself.

Reforms \"urgently needed\"

PwC's message was reinforced by the European Central Bank (ECB) this afternoon. At ECB President Wim Duisenberg's last interest rate meeting - rates were left on hold - he said that he was confident that the Eurozone is beginning to recover.

He said that recent economic activity has been slightly better than expected and that "this upturn should gradually strengthen in the course of 2004".

But the ECB, too, stressed the need for reform.

Mr Duisenberg said he was perhaps stating the obvious, but declared, "more reforms are urgently needed to reduce structural rigidities in labour and goods markets so as to address the main economic problem of the euro area, namely the high level of structural unemployment".

Luxembourg tax scandal may prompt EU action

An investigation into Luxembourg's tax regime has uncovered how the Italian mafia, the Russian underworld, and billionaires attempt to stash away their wealth. The European Commission has put itself on standby amid suggestions changes to EU law may be needed.

Investigation

Portugal vs Germany clash on EU corporate tax avoidance

Portugal's taking over the EU presidency puts the tax transparency law for corporations - which has been fought over for years - to a vote in the Council of Ministers. The resistance of the German government has failed.

News in Brief

  1. Covid: Belgium might close schools and cultural activities
  2. EU consumers can sue Facebook, judge advised
  3. French centre-right tilts toward Pécresse
  4. EU urged to blacklist Israeli spyware firm
  5. Austria's ex-chancellor Kurz quits politics
  6. EU agency: Omicron to be over half of infections 'within months'
  7. New German restrictions target the unvaccinated
  8. EU commission unveils proposal to digitalise justice systems

Vietnam jails journalist critical of EU trade deal

A journalist who had demanded the EU postpone its trade deal with Vietnam until human rights improved has been sentenced to 15 years in jail. The EU Commission says it first needs to conduct a detailed analysis before responding.

Stakeholders' Highlights

  1. Nordic Council of MinistersNew report reveals bad environmental habits
  2. Nordic Council of MinistersImproving the integration of young refugees
  3. Nordic Council of MinistersNATO Secretary General guest at the Session of the Nordic Council
  4. Nordic Council of MinistersCan you love whoever you want in care homes?
  5. Nordic Council of MinistersNineteen demands by Nordic young people to save biodiversity
  6. Nordic Council of MinistersSustainable public procurement is an effective way to achieve global goals

Latest News

  1. Belgium tightens Covid rules as health system 'is cracking'
  2. EU and US tighten screw on Lukashenko
  3. Belgian impasse leaves asylum seekers on snowy streets
  4. EU 'missed chance' to set fossil-fuel subsidies deadline
  5. EU energy ministers clash amid gas price uncertainty
  6. ECJ told to dismiss Poland and Hungary rule-of-law challenge
  7. Covid: what Germany got right - and wrong
  8. Quick Take: Enrico Letta

Join EUobserver

Support quality EU news

Join us