The European Commission has announced that “solid world trade, a weakening euro and consumer demand” meant that economic growth in the eurozone is likely to rise above the predicted 1.7 per cent, in itself rather low.
Nevertheless, the recently appointed but outgoing Economic Commissioner, Joaquin Almunia, was not precisely in up-beat mood. He said he could make no predictions for 2005 and expressed a worry that rising oil prices might trigger off another inflation.
“The recovery (in the eurozone) is not yet self-sustaining and, in the context of a maturing global trade cycle, robust domestic demand will become increasingly necessary,” – said Mr Almunia. He criticised the member states who breached the budget deficit rules, making it clear that by 2005 as many as half of the 12 would be running deficits. (One wonders what the point is of rules that are obeyed by only half of those to whom they apply. And does not include EU member states outside the eurozone, like the new intake, most of whom will have large deficits.)
“This is particularly urgent since the window of opportunity before the impact of ageing is fully felt is small and closing,” – he added somewhat mysteriously.Curiously, he did not criticise anybody for failing to carry out any structural reforms in order to make the economies stronger and more productive. After all, relying on other economies strengthening and one's own currency weakening is not precisely the sort of healthy, sustainable economic development that was envisaged when the euro was imposed on all these countries.