Economic growth remains subdued due to weak external demand and declining domestic confidence. Solid fundamentals, favourable financial conditions and a gradual improvement of the external environment should nevertheless allow the economy to recover steadily in 2015 and 2016. Unemployment, though high for national standards, remains among the lowest in the European Union.
Inflation is projected to stay above euro area average. The restructuring of distressed financial institutions continues to add to public debt. Reducing effective marginal income tax rates, especially for the low skilled, and increasing the effective retirement age would support labour force participation and growth, and help to deal with the increasing costs of health care and pensions.
Note: All data definitions based on internationally comparable standards and may differ in specific cases from common national definitions.
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