The euro zone will be stuck in economic crisis by the end of the year. This is the hope of Mario Draghi, former Prime Minister of Italy and President of the European Central Bank (ECB). “It is almost certain that we will have a recession by the end of the year. “It is quite clear that this will be seen in the first two quarters of next year,” he told the Financial Times.
That makes Draghi significantly more pessimistic than the International Monetary Fund (IMF) and ECB, who expect quarterly growth of at least 0.1 percent in the last three months of this year. The IMF also expects growth to be 1.5 percent next year compared to 1.3 percent this year.
Draghi cited the eurozone’s low productivity, high energy costs and a shortage of skilled workers as reasons for his skeptical view of the future. He also acknowledged that Europe has lost competitiveness compared to the United States, China, South Korea and Japan over the past 20 years.
From July to September, the euro zone economy shrank 0.1 percent quarter-on-quarter, according to preliminary estimates from statistics agency Eurostat.