Monday, 8 Mar 2021

‘The joys of the euro!’ French fury after breaking record for worst-ever eurozone deficit

EU at ‘crunch point’ over future of the Eurozone says expert

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The embarrassing slump sparked fury in France after both President Emmanuel Macron and the EU failed to provide solutions to an increasingly stagnating financial crisis in the bloc.

French analyst Nicolas Meilhan called it a “sad record” as he urged the French leader to make the issue his national priority.

He tweeted: “France has probably broken a sad European record: the worst trade deficit that a European state has ever recorded: -82.5 billion € in 2020.

“I really have a hard time understanding why the elimination of this record deficit is not THE national priority.”

Commenting on the devastating data, Generation Frexit leader Charles-Henri Gallois blamed the bloc’s internal market and common currency for the slump.

He said: “The joys of the euro and the total free trade imposed by the EU treaties.

“Relocation and re-industrialisation must be the number one priority!”

In its latest quarterly forecasts, the European Commission predicted the EU’s gross domestic product would increase by 3.7 percent this year, down from its previous forecast of 4.2 percent.

Its economists warned the EU’s economic recovery was directly linked to the bloc’s ability to successfully deliver doses of Covid jabs to member states.

They said the downward revision in their winter forecast was “related to the evolution of the pandemic and the pace, efficiency and effectiveness of vaccination rollout”.

The Commission said it was forced to downgrade its economic forecasts because of the continued “uncertainty and risks” surrounding the latest wave of COVID-19 infections battering the bloc.

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“In terms of negative risks, the pandemic could prove more persistent or severe in the near-term than assumed in this forecast or there could be delays in the roll-out of vaccination programmes,” its report said.

“This could delay the easing of containment measures, which in turn affect the timing and strength of the expected recovery.

“There is also a risk that the crisis could leave deeper scars in the EU’s economic and social fabric, notably through widespread bankruptcies and job losses.

“This would also hurt the financial sector, increase long-term unemployment and worsen inequalities.”

The Commission’s winter forecast did not price in the threat of further delays to the bloc’s vaccination roll-out.

Analysts at German finance giant Allianz recently warned Europe’s Covid jab scheme was facing a “five-week delay”, which could cost its economy €90 billion if left uncorrected.

Economy commissioner Paolo Gentiloni said: “Europeans are living through challenge timings.

“We remain in the painful grip of the pandemic, its social and economic consequences all too evident.”

The euro is expected to grow 3.8 percent, a faster rate than the wider EU economy.

The Netherlands (1.8 percent), Germany (3.2 percent) and Ireland (3.4 percent) are all forecast to grow less than the average prediction for the EU.

In contrast, the main recipients of funds from the bloc’s €750bn recovery fund – France (5.5 percent) and Spain (5.6 percent) – are expected to make bigger gains.

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