The eurozone could face a second year of recession with negative growth of -0.3% and a new surge in unemployment next year if governments continue to pursue the current path of austerity.
This is one of the main conclusions of a new report, the independent Annual Growth Survey (iAGS), . The report was commissioned by the S&D Group in the European Parliament and prepared by three major economic institutes: the OFCE (Paris); the IMK (Düsseldorf) and the ECLM (Copenhagen).
The authors of the report argue that the 'moderate growth' of 0.1% for 2013 forecast by the Commission in the autumn will not be achieved. They believe that the European Commission's predictions are based on the wrong fiscal multiplier, thereby underestimating the negative impact of further austerity measures on economic growth.
The full report will be presented tomorrow during a press conference chaired by S&D Group President Hannes Swoboda with the three institutes, just before the European Commission's own recommendations are published in the Annual Growth Survey.
Press Conference - Room ASP 5G2 - 10am - Hannes Swoboda with Philippe WEIL, president of the OFCE (Observatoire français des conjonctures économiques), Andrew WATTS, deputy director of the IMK (Macroeconomic Policy Institute) and Lars ANDERSSON, director of the ECLM (Economic Council of the Labour Movement).
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