The entire European continent continues to experience strong growth in terms of its economic standing in the global race. In 2017, Europe’s GDP enjoyed an increase by 2.8 percent, a percentage higher than its 1.8 percent rate in 2016.
According to a recent forecast, Europe is set to enjoy a stable and strong growth at present, but experts predict a decline in 2019 – and this includes economies from its sub-region, Eastern Europe. Amidst the positive economic climate today, both Central and Eastern Europe are facing murkier forecasts in the coming cycles.
Additional data also points out that the economic outlook of Eastern Europe has finally lost its steam, slowing down from its previous boom from the past year. This can be attributed to the region’s weaker external demand which was a direct cause of the same slowdown suffered by the entire Eurozone.
Eastern as well as Central Europe which are often characterized by cyclically advanced economies, are now facing rapidly growing wages, with inflation that is predicted to pick up this year. Such events can relatively affect the region’s performance among its regional and global competitors.
Further threats by the trade war initiated by the United States’ President Donald Trump against the European Union are set to affect the region’s short-term growth and economic performance. In fact, many experts fear that if the situation won’t show signs of improvements, it could stifle Eastern Europe’s most vital industries, trading, and its overall economic stability.
With major structural and fiscal reforms, these effects are nowhere near their ending. Both Central and Eastern Europe are facing downside risks, due to the deteriorating state of global trade relations that are currently threatening the entire region’s growth trajectory.