The Unassuming Economist

From VoxEU.com by Maarten Verwey, Oliver Dieckmann, Przemyslaw Wozniak posted on 16 November 2021

“The growth outlook for the EU is for a continued economic expansion. With large shares of the population currently protected against severe COVID-19 cases and deaths (ECDC 2021), the EU economy is assumed to avoid lockdowns and to continue benefitting from the reopening momentum. As a result, the EU and the euro area, which were in the third quarter just a notch below their pre-pandemic output levels, are set to transition from recovery to expansion (Figure 1). This projection implies reaching the Commission’s extrapolated pre-pandemic forecast path within the forecast years, and approaching the pre-crisis growth trend much faster than after previous recessions. After the Global Financial Crisis in 2008-09, for example, it took the EU economy more than four years for just returning to the pre-crisis level of output. The atypical nature of the recession and the substantial policy support, including NGEU/RRF, were essential for this result.”

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