The Economic outlook has not changed substantially since I presented the Commission’s Winter Economic Forecast on 25 February. We continue to project growth in the euro area of 1.2 per cent this year and 1.8 per cent next year, driven by a gradual strengthening in domestic demand, an easing of deleveraging and fiscal consolidation needs and on the back of improving confidence. The Commission’s economic sentiment indicator for the euro area rose again in March and is now clearly and firmly back above its long-term average.
The financial market situation in Europe remains stable and the positive long-term momentum is continuing. This is being supported by sustained accommodative monetary policy, expectations of continuing economic recovery and confidence in the positive effects of the Banking Union. Nevertheless we need to focus on strengthening the recovery for the sake of stronger growth and job creation and thus it is essential to maintain the momentum of economic reforms now.
Concerning Greece, we all know how difficult this adjustment has been and how great are the challenges faced by many Greek citizens still today. I acknowledge the great efforts made by Greece over the past four years to repair the public finances and build a more sustainable model for growth and job creation. There was no easy way to resolve the problems confronting Greece in 2010, given the scale of economic imbalances that had built up, over so many years.
Today, the Greek economy is stabilising and we expect a return to growth and a gradual recovery in employment starting this year. To strengthen this recovery and boost job creation, it will be essential for Greece to continue to embrace economic reforms, maintain sound public finances and facilitate targeted investments. The EC will continue to stand by Greece and support Greece in creating the conditions for sustainable growth, as we have until now through the programme and through technical assistance provided by the Task Force for Greece.
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