By
Peter Kramer
The European Commission delivered last week the message that the Eurozone economy is shrinking seriously over the next years. This bad news didn’t make it to headlines, because the Euro Dream has to be kept alive by EU institutions and their servile media-partners.
The forecast for the Eurozone (the 19 EU countries using the euro) tells, that in 2018 the economy will grow 2.1%, down from 2.4% over 2017, the best year for the Eurozone in a decade. For 2019, a growth of 2% is forecast and for the year after, 2020, a further slowdown to 1.7%. Practice over the last years has shown that the forecasts of the Commission are most of the time rather higher than eventually the reality. There is a serious reason for concern.
The main threat for the Eurozone according to the Commission, is the rapid growth of the US economy since the beginning of 2017, when Donald Trump’s presidency started. Cutting taxes and increased government spending have prompted the US Federal Reserve (the US Central Bank) to raise its key interest more than currently anticipated.
The Commission has raised concerns that the expanding US economy will suck in more imports, widening the country’s trade deficit and prompting fresh tariff increases. But be not be surprised if the US administration is not impressed by such a comment from ‘Brussels’.
Another blow for the Eurozone economy could be a hard Brexit, a possibility that seems more and more likely. The arrogant EU negotiator Barnier didn’t miss a chance to humiliate the British counterparts including Prime Minister Theresa May. In their minds is that a Brexit will be a bigger economic problem for the UK than for the EU.
But even if a hard Brexit comes to pass, it doesn’t mean that the Eurozone economy, already in descent, can escape being hit. It would be better for EU leaders to focus more on the effect of Brexit on their country’s economies than to worry about how the Brussels’ Eurocrats are exacting Brexit revenge.
It is clear the national economies of Belgium, Th Netherland and Ireland will endure severe blows from a hard Brexit but France and Germany will also share considerably in Brexit pain.
Anyhow, the moment of truth is nigh...
