|The recovery is projected to strengthen over 2014-15. Investment has turned around, including in the housing market, and is expected to grow solidly, although from a low base. Exports, aided by stronger trading partner growth, are projected to pick up. Steady employment growth will help bring the unemployment rate down further. Spare capacity will help keep wage and price inflation subdued.
To keep high public debt firmly on a declining path the government should implement its structural consolidation plans through to 2015. The process of restoring health in the banking sector should be reinforced by continuing to reduce the elevated level of non-performing loans and repairing the bank credit channel. Improving the public employment service and activating the long-term unemployed must remain a priority to ensure the recovery benefits society as broadly as possible. Growth potential should be boosted by complementing high attractiveness to foreign investment with further efforts to foster innovation across the whole economy and to ease firms’ access to capital.
Note: All data definitions based on internationally comparable standards and may differ in specific cases from common national definitions.
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