Europe's economy expected to grow 1.6 percent this year

According to an announcement by the European Commission on Monday, Europe's economy is expected to grow 1.6 percent this year. 

via The New York Times

Siim Kallas, vice president of the European Commission, during a press conference in Brussels. | Francois Lenoir/Reuters

Siim Kallas, vice president of the European Commission, during a press conference in Brussels. | Francois Lenoir/Reuters

The European Commission said on Monday that growth across the European Union would gain significant momentum this year and continue through 2015, but it also warned of numerous threats that could still derail a slow, gradual recovery.

The commission, the bloc’s executive arm, also stressed the need for more robust domestic consumption partly because of an expected weakening of demand for European exports.

“The recovery has now taken hold,” said Siim Kallas, an Estonian politician who is a vice president of the commission. But it is “important to embrace structural reforms early on and to stay the course, whatever challenges may be faced along the way,” he said.

Mr. Kallas [...] identified multiple hazards that could still affect the economy, including tensions with Russia, a prolonged period of low inflation, and an unwillingness by member governments to continue reforms.

Concern about the vulnerability of the euro area was highlighted by a small trimming of the growth forecast for next year to 1.7 percent from the 1.8 percent forecast issued in February.

But overall there was some reason for optimism, Mr. Kallas said. “Deficits have declined, investment is rebounding and, importantly, the employment situation has started improving,” he said.