EBRD warns of tough times for Europe

EBRD warns of tough times for Europe

Published: October 26, 2012

Bank revises growth forecasts downwards for several countries.

Emerging Europe will face further challenges before enjoying economic recovery, warn economists at the European Bank for Reconstruction and Development (EBRD).

The bank’s latest quarterly Regional Economic Prospects report predicts that growth in the transition region will drop to 2.7% this year from 4.6% in 2011. Next year the bank expects a modest pick-up to 3.2%.

EBRD economists note that the bank’s region of operations fared worse during the first half of 2012 than in the second half of 2011. Economic activity in Central Europe, the Baltics and Southeastern Europe was noticeably slower, they add.

The bank has revised its growth forecast for Ukraine to just 1% in 2012 from an earlier projection of 2.5% and 5.2% achieved in 2011. Forecasts for Slovenia, Hungary, Croatia and Serbia have also been revised downwards – all countries remain in recession.