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THE SIZE of the Eurozone economy fell by 0.6 per cent in the fourth quarter of 2012 – its steepest fall in nearly four years.
Figures produced by Eurostat showed that the combined economies of the 17 countries that use the euro produced 0.9 per cent less in the fourth quarter of 2012 than they had in the equivalent period of 2011.
When all 27 EU member states are taken into account, growth fell by 0.5 per cent from Q3 to Q4, and by 0.6 per cent in a year.
The 0.6 per cent fall is the worst since the immediate onset of the financial crash in 2008; a single quarter has not seen a decline so steep since the first quarter of 2009 when the Eurozone economy shrank by a whopping 2.8 per cent.
In that case, the decline levelled off to 0.2 per cent in the second quarter and back into growth three months later.
Portugal had the steepest decline of any country; its economy shrank by 1.8 per cent in the fourth quarter, while Cyprus saw a drop of 1.0 per cent and Italy – where Mario Monti completed his final quarter as stand-in prime minister – shrank by 0.9 per cent, equalling the fall in Hungary.
Latvia had the strongest growth, at 1.3 per cent, ahead of nearby Lithuania on 1.0 per cent and Estonia at 0.9 per cent.
The figures do not include Ireland, which is not due to confirm fourth quarter figures until the end of March, but the figures are still bad news for Ireland – with general acceptance that trouble for economies in mainland Europe will impede the chances of an export-led Irish recovery.
On an annualised basis, Latvia had the highest annual growth at 5.7 per cent; Estonia is the highest of the euro users with 3.4 per cent.
At the other end, Greece’s economy shrank by an estimated 6 per cent in 2012, while Portugal fell by 3.8 per cent and Cyprus by 3 per cent.
The UK economy shrank by 0.3 per cent in the fourth quarter, and grew by 0 per cent in 2012 as a whole.
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Makes the Anglo “deal”, look even worse.
Unless Ireland can outperform the Euro zone by 1% every year for the next 40 year, inflation will not decrease the burden it will add to it.
Michael Noonan “forgot” (read refused), to tell us what the banks have legally had to tell us for years, “Past performance is no indication of future performance”.
For the benefit of readers who might not understand what you’re getting at, Eurostat figures put Inflation in the Eurozone at 2.0% in the year to January 2013.
Basic 101 economics ‘The Law of Diminishing Returns’
Austerity really working I see.
It is working! For the billionaires that is.. their wealth is increasing rapidly.. look it up yourselves.
Look at the situation from the perspective of its creators.
And is anyone really surprised by this? What exactly is it going to take to make the Germans realise that austerity economics is not working – you can’t cut your way out of a recession.
It’s not entirely bad news for Ireland. It means that interest rates are unlikely to rise at any time in the near future, which will be a relief to anyone who owes any significant debt.
So who profited on the 0.6% debt increase?
The economy dropped 0.6% in the forth quarter of 2012.
Debt is a different issue. I don’t know understand what you’re saying. ? Sorry
The debt based money system we use is essentially a ponzi scheme. As money is only created through debt and it demands payment with interest it is mathematically impossible to pay down all debts. The system must grow exponentially to feed the new money creation. Unfortunately permanent exponential growth is also mathematically impossible. By taking on the debts of the sick monsters who would enslave us our government has sold us down the river and up the swanny. We can just hope against hope that the system’s bubble reinflates itself long enough for us to dig ourselves out of this. The future of this country depends upon this very dodgy gamble…
Very well said John.
Try telling that Jack Bowden, 2 comments up. He didnt get what I was hinting at.
tin hats for sale, 50 euro.
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