|Following six years of deep recession, growth is projected to be positive in 2014, and to gain additional momentum in 2015-16. The recovery will be led by buoyant exports and strengthened investment activity, supported by improved competitiveness. The unemployment rate is set to decline gradually, but will nevertheless be close to 24% in 2016. Prices and wages will keep falling given large spare capacity, but at a slower pace.
The high debt burden makes fiscal prudence imperative, but the automatic stabilisers should be allowed to work around the consolidation path. Additional debt relief may be needed. Rapid restructuring of bank balance sheets and maintaining the momentum of structural reforms are key to sustained growth.
Note: All data definitions based on internationally comparable standards and may differ in specific cases from common national definitions.