Daily Management Review

European Commissioner Gentiloni does not expect euro zone to exit the crisis soon


Paolo Gentiloni, a member of the European Commission for the economy, believes that most of the eurozone countries will not reach pre-crisis GDP levels by the end of 2021. He said this after a meeting of the Eurogroup - the Council of Eurozone Finance Ministers.

"The second quarter GDP data released by Eurostat this week confirmed that we are in a deep economic downturn in the euro area, with production falling 11.8%," he said.

According to him, these data also confirmed that the observed decline is extremely uneven: the quarterly decline in GDP ranges from about 4% to 18% in different countries. The official believes that this confirms the presence of fragmentation, the risk of which was taken into account when the EU chose a strategy for economic recovery.

"Employment also fell by a record 2.9% in the euro area in the second quarter, although the labor market situation would certainly have been worse if it were not for the introduction of short-term work schemes that we are going to start supporting through the European SURE Mechanism," continued European Commissioner.

He also said that as antivirus restrictions eased, there was a significant increase in activity in June and July, "but indicators point to a slowdown in activity in recent weeks as countries face new outbreaks of the virus." The EC expects that most eurozone countries will not reach pre-crisis GDP levels by the end of 2021, with an average lag behind these levels of 2.5%. 

source: ec.europa.eu