The European Union is experiencing the worst economic recession ever

The European Union is experiencing the worst economic recession ever
On June 8, local time, nearly three months after the closure of the new coronary pneumonia epidemic, the national catering industry in Belgium reopened to welcome guests, and primary and secondary schools began to resume classes in full. At the same time, France, Italy, Spain and other European countries have also accelerated the implementation of “restart”. All circles in Europe call for the implementation of the recovery plan as soon as possible, and strive to alleviate the severe economic crisis while continuing to prevent and control the epidemic.

In terms of industry, the trade, transportation, tourism, catering, arts, entertainment and other service industries were the hardest hit by the epidemic in the first quarter of 2020, with a total decrease of more than 6.8% year-on-year; agricultural and necessities producers were relatively affected small.

The epidemic also caused pressure on the job market. Employment in the European Union and the Eurozone fell by 0.1% and 0.2% year-on-year in the first quarter of this year respectively, ending the continued growth in employment since the second quarter of 2013.

What is particularly interesting is that the German economy is facing rare and severe downward pressure. In recent years, Germany has been the “locomotive” of the European economy, and trade is the ballast stone of the German economy. Affected by adverse globalization and the rise of trade protectionism, Germany’s foreign trade has encountered difficulties in the fourth quarter of 2019. According to the latest data released by the German Federal Statistical Office on June 9, Germany’s total foreign trade in April 2020 was 75.7 billion euros, a year-on-year decrease of 24%, the largest monthly decline since the record began in 1950. The German trade surplus has also fallen to its lowest point in nearly 20 years.

According to the prediction of the European Commission, the economic output of the EU in the first quarter of 2020 will fall by almost 16% compared with the fourth quarter of 2019. Although economic activities in the EU are expected to resume as the economic recovery plan begins and the epidemic closure measures are gradually lifted, the EU’s gross domestic product (GDP) is expected to shrink by 7.4% in 2020, far exceeding the worst period of the 2009 financial crisis 4.3%. The Eurozone economy will be hit harder, and GDP is expected to drop significantly by 7.75%.

In response to the unprecedented economic crisis, the European Commission launched a recovery plan called “Next Generation of the European Union” at the end of May. To support member countries to overcome the new crown epidemic crisis and promote the EU to achieve the two major transformation and upgrading goals of “green economy” and “digital strategy”.

In view of the large differences within the European Union on the issue of “debt sharing”, whether the huge recovery plan prepared by the European Commission will be approved in the short term will depend on the EU’s political good offices and the willingness of all parties to compromise.

The European Employers’ Association, which represents more than 200,000 EU industrial companies, said recently that the “Next Generation” recovery plan proposed by the European Commission has provided an effective plan for Europe to shake off the economic crisis caused by the epidemic, and urged EU countries to immediately approve this plan, And accelerate the implementation in a spirit of solidarity and cooperation, injecting confidence and momentum to restart the EU economy.