SJ Salomon International - Lagarde Predicts Recovery for Europe Late 2021

Tokyo, Japan, April 27, 2021 --(PR.com)-- The European Union has faced a difficult battle against the coronavirus pandemic with vaccine delays and extended lockdowns severely hampering economic activity across the euro zone.

New waves of infection have prompted government officials throughout Europe to implement extended lockdowns and place restrictions on gatherings and normal business operations, causing significant delays to the region’s economic recovery. However, Christine Lagarde, president of the European Central Bank believes a strong recovery is on the card for the EU in the latter half of this year.

The International Monetary Fund has also predicted that growth for the EU will pick up in 2021. IMF growth projections for the EU see the economy expanding by 4.5% this year. This is on par with predictions for most developed economies, apart from the US which is expected to expand by 6.4% this year.

Economists at SJ Salomon International believe the greatest threat to the EU’s economic recovery at this point is the risk of new virus strains and slow vaccine delivery.

The IMF has stated that the top priority is increasing vaccine production in Europe. This will be necessary not just for the euro zone but also the rest of the world that will rely on Europe as a hub for vaccine supplies and production.

SJ Salomon economists believe stimulus will also be an important factor in the successful economic recovery of the euro zone. The region has drawn criticism for being too stingy with its fiscal support during the pandemic.

“Although it is possible that the EU’s economic recovery fund may prove insufficient, it is more important at this point that the 750 billion euro in funds are paid out quickly and spent in a way that provides the maximum benefit to the economy,” says Youta Watanabe, Chief Finance Officer at SJ Salomon International.