Economic Survey of Europe (Paperback, 2003, No. 2 ed.)

In mid-2005, there is a broad consensus of forecasters that the recovery of the global economy will continue at a robust rate in the remainder of 2005 and in 2006, with the United States and China seen to remain the major engines of growth. The upward trend of oil prices, however, has cast a shadow over this relatively favourable outlook and, if continuing, risks choking off economic growth in the oil importing countries. In the euro area, short-term prospects are for only moderately strengthening activity, largely reflecting the lack of economic dynamism in the three major economies (France, Germany and Italy). Stronger growth of domestic demand is necessary for achieving a sustained and meaningful recovery. Eastern Europe, including the new EU member states, continues to experience robust economic growth significantly above the average for western Europe. This favourable performance reflects a combination of strong export competitiveness and solid growth in domestic demand, partly reflecting the ongoing modernisation of the physical capital stock. In the CIS, economic growth is also maintaining quite strong momentum. Commodity exporters, especially countries that are specialised in hydrocarbons, will continue to benefit from high world market prices and strong demand in some of their main markets.