The European Commission expects sluggish gross domestic product (GDP) growth in the European Union during 2023-2025, according to new a new forecast published on Thursday.
"After narrowly avoiding a technical recession in the second half of last year, prospects for the EU economy in the first quarter of 2024 remain weak," a commission press release said.
The EU executive's latest forecast is even bleaker than its previous estimates. Growth has been "held back by the erosion of household purchasing power," high interest rates and falling demand for exports, it said.
The commission estimates EU GDP grew 0.5% in 2023 and predicts 0.9% in 2024, downgrading its previous forecast of 0.6% and 1.3% respectively. It forecasts 1.7% in 2025, in line with its last prediction.
In the eurozone — the 20 countries that use the euro as their national currency — the commission expects growth of 0.5% in 2023, 0.8% in 2024, and 1.5% in 2025.
Germany is among the EU's weaker performers in the latest figures. The commission's forecast estimates that German GDP shrank 0.3% in 2023 and will grow by 0.3% in 2024.
Irish GDP contracted 1.9% in 2023, but is expected to grow by 1.2% in 2024 and 3.2% in 2025, well above the EU average.
The Baltic states of Latvia, Lithuania, and Estonia all suffered recessions in 2023. Estonia was the EU's worst-hit economy last year, with a 3.5% contraction in national GDP.
Luxermbourg, Austria, Finland, the Czech Republic, Hungary and Sweden also had recessions in 2023.
The commission predicts no member state will experience recession in 2024 or 2025. Sweden is expected to see the weakest growth of 0.2% in 2024. It anticipates the strongest growth in Malta (4.6%), Romania (2.9%) and Poland (2.7%).