IMF: European Economies to Contract Sharply This Year

The IMF released it Regional Economic Outlook for Europe on May 12th. Some of the key takeaways from this release are:

click to enlarge

Source: IMF

• Europe’s current deep recession: there is a risk that it could worsen further
• Western Europe is projected to see their economies shrink by 4.0% in 2009
• Output in Emerging European countries would fall by 4.9% in 2009
• Modest decline for Western Europe and modest recovery for Emerging Europe in 2010
• Demand for goods fell sharply in 4Q, 2008 leading to 26% annual rate decline in trade
• Domestic real estate crash has severely affected the Baltic economies, Ireland, Spain, and the United Kingdom
• Large public debt and current account deficits have been the cause of collapse for some countries such as Hungary and Greece

Comments

[Dave Wrixon:]

Yes, but I just find it all funny.

Germany is contracting mainly due to a drop of exports to the US. But the US is much less severely affected than Germany. Give me a break!

Also, just returned from Czech Republic which is fairly dependent on Germany. Job to tell what all the fuss is about. Have one friend who was very concerned about his job, but his company has just got a whole new set of orders. Of course it is not booming like China and yes it is a lot weaker than before, but in our street alone two houses are having their external facades insulated. Not really the meltdown you keep hearing about, but you can just about hire tradesmen these days which in a way is something of a relief. I did notice that there were a lot of electronic goods deals, but then you must expect that if the production that intended to the US has to be dumped somewhere else.

May 15 05:21 AM