Improving growth in export markets, gains in market share and the stabilisation of private domestic demand will help to foster a weak recovery in 2014 and 2015. However, fiscal consolidation and tight credit conditions will remain a drag on growth. The unemployment rate is expected to peak in 2014 before gradually declining as growth picks up. Continued large economic slack will keep wage and price pressures subdued.
With a recovery in sight but the economy still fragile, the government needs to pursue its structural fiscal consolidation path, but also allow automatic stabilisers to operate fully. To improve the economic environment and stimulate growth, the governmentmust fully implement all its announced reforms. To reduce the extremely high structural and youth unemployment new activation and training measures to upgrade workforce skills and facilitate mobility across sectors are needed. Employers should play a major role in training design.
Note: All data definitions based on internationally comparable standards and may differ in specific cases from common national definitions.