Greek economy to bounce back from years of recession: EU
(BRUSSELS) - The crisis-hit Greek economy will end six years of recession in 2014, the European Commission said on Tuesday with sky high unemployment finally falling slightly.
The data comes as Athens plans to end the EU-side of its 240 billion-euro ($300 billion) international bailout at the end of the year, a move that has spooked the markets.
In its autumn economic forecasts, the commission said Greece will grow by a slim 0.6 percent this year, then pick up to 2.9 percent in 2015 and 3.7 percent in 2016.
Its rate is only matched that year by Ireland, another bailed-out eurozone member.
"The situation is still very difficult, but there is hope," said Pierre Moscovici, the EU's new economic affairs commissioner.
The acceleration, after painful years of recession and austerity measures, is in sharp contrast to the overall eurozone expansion, forecast to only reach 1.7 percent in 2016.
Despite the positive signs, Greece remains a worry on the world markets and EU officials have signalled that some sort of credit line for Athens is in the works.
Last month, comments by Prime Minister Antonis Samaras that Greece would shed its creditor shackles completely, including an early exit of IMF oversight, sent stocks into a tailspin.
Most worrying for Greece's European partners is the fragile state of its public finances.
In its forecast, the commission said Greece's mountain of public debt at the end of the year would stand at a huge 175.5 percent of annual output.
This is nearly three times the EU limit of 60 percent, and far too high for Greece to win over bond markets to borrow still more.
Brussels said the debt level would fall slightly in the coming years, but Greece would still remain the EU's most indebted nation, at 157.7 percent of GDP in 2016.
Joblessness in Greece will remain at a high 22 percent in 2016, down from the current 26.4 percent.
The commission said the economic picture is mixed for other countries hardest hit by the debt crisis.
Ireland is set to grow a sharp 4.6 percent this year and 3.6 percent next year. Irish unemployment, now 11 percent, should sink to 8.5 percent in 2016.
Portugal, which ended its EU-IMF bailout earlier this year, will see its economy expand from 0.9 percent this year to the eurozone average of 1.7 percent in 2016. Unemployment will dip from 14.5 percent to 12.8 percent in 2016.