Regional Economic Outlook for Europe, April 2024 | Soft Landing in Crosswinds for a Lasting Recovery

COMING SOON

IMF's Regional Economic Outlook for Europe:  Turning the Recovery into Enduring Growth

Tuesday, May 14, 2024 | 8:30 AM ET

Europe has done remarkably well against a turbulent backdrop. After years of crises and their fallouts, a soft landing for the continent’s economies is within reach. Securing it will require careful calibration of macroeconomic policies. As the cyclical recovery runs its course, growth will increasingly depend on structural factors. Yet there are several formidable headwinds to growth, including weakening productivity, an aging population, and underinvestment. Navigating these headwinds to higher medium-term growth will require structural reform efforts that should begin now. For the EU, this means urgently tapping the significant potential from further European integration. Combined with complementary measures at the domestic level, these reforms would go to show once again how Europe can overcome even the most severe obstacles when acting decisively and together.  

The just released IMF Regional Economic Outlook for Europe discusses the economic reform agenda needed to cope with these multiple challenges. The discussion will focus on what policymakers in Brussels and at the national level can and should do to return Europe to greater competitiveness and faster growth. 

Speakers:

Alfred Kammer, Director, European Department, IMF
Maria Demertzis, Senior Fellow, Bruegel
Christiane Nickel, Deputy Director General Of DG Economics, European Central Bank
Moderated By Maria Tadeo, Europe Correspondent

Soft Landing in Crosswinds for a Lasting Recovery

A soft landing for Europe’s economies is within reach. Securing the baseline of growth with price stability will require careful monetary policy calibration. Faster fiscal consolidation would ensure buffers are adequate to tackle future shocks, while structural fiscal reforms would help address mounting long-term expenditure pressures. Beyond the near-term recovery, raising potential growth prospects calls for efforts at both the domestic and European levels. Measures should aim to raise labor force participation, prepare the workforce for looming structural shifts, set an enabling environment for private investment, and promote innovation on a level European playing field—especially when it comes to the green transition, including through a strong commitment to carbon pricing. Greater European integration would amplify the effect of these reforms. Formulating an ambitious set of growth-enhancing reforms should be a key priority of a new EU commission.