IMF: European economic recovery to be slow, fragile

The current European economic recession is showing signs of bottoming out, but the recovery is likely to be slow and fragile, the International Monetary Fund (IMF) said Saturday in its October 2009 Regional Economic Outlook (REO) for Europe, Xinhua reported.
  
Helped by rebounding confidence and a tentative pick up in global trade, the contraction in Europe appears to have ended at mid-2009 and is expected to give way to a moderate recovery in 2010 and more solid growth returning only afterwards, the report said.
  
"The long recession shows signs of finally bottoming out, but the recovery will likely be slow and fragile because the pickup in demand from Asia can hardly substitute for the pre-crisis appetite for imports of U.S. consumers," said Marek Belka, director of the IMF' s European Department.
  
"Europe cannot count on exports alone to drive the recovery," Belka added.
  
The regional report said financial sector difficulties, weak investment, and long spells of unemployment are likely to hold back potential growth in Europe over the next few years, but the magnitude of their impact is uncertain.
  
In the latest World Economic Outlook, the economic growth in most European countries is expected to walk out of the negative territory next year, and the European Union would achieve a 0.5 percent growth from minus 4.2 percent in 2009.