Brussels cheerful about Dutch economy: growth adjusted to 3.3% | Financial

The European Commission is forecasting economic growth of 3.3% both this year and next, well ahead of its forecast earlier this year. In February it was 2.3% and in February the daily EU board expected only 1.8%.

The commission is substantially revising the EU-wide economic growth forecasts for this year and next. She expects the 27 countries to have already recovered to pre-coronavirus levels by the last quarter of 2021. Some countries that have been hit less economically than others, including the Netherlands, may already be in the summer. “A real success,” said Vice-President Valdis Dombrovskis.

Brussels expects an average of 4.8% growth for the EU over the year, 0.6 percentage points more than the commission forecast earlier this year. In 2022 it will be 4.5%. In an economically strong country like the Netherlands, growth is naturally more modest than this average.

On the other hand, the inflation figure for this year is now also estimated to be higher. The commission predicts inflation of 2.2 percent, or 0.3 percentage point more than previously calculated for the entire EU. The Netherlands compares relatively favorably with an estimated 1.8 percent and for the eurozone 1.9 percent. The European Central Bank (ECB) aims for an average inflation rate of just below 2 percent.

The increase in inflation is due to increased energy and raw material prices and problems in the production and supply of parts and materials. The imbalance between supply and demand should be back in balance next year, Brussels believes.

According to Dombrovskis, “the European economy is making a strong comeback and all the right pieces are falling into place.” Especially at the beginning of the year things went better than expected and now that the vaccination campaign is gaining momentum and the shops, restaurants and holiday resorts are reopening, citizens and companies can earn and spend money again. The billions of aid from the EU recovery fund will also help to recover, the committee says. EU finance ministers are expected to approve the first recovery plans next week.

However, the committee also warns of great uncertainty, especially of the consequences of corona variants if the EU cannot keep them under control.

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