- The United States and China reported solid economic growth in 2021, while Europe’s economy shrank 0.6 percent during the first three months of the year
- Officials attributed Europe’s poor showing to its slow progress in vaccinating its public
- The U.S. economy grew 1.6 percent during the first quarter, driven by strong consumer demand
FRANKFURT, Germany: While the United States and China reported solid economic growth in 2021, Europe’s economy shrank 0.6 percent during the first three months of the year.
Officials attributed Europe’s poor showing to its slow progress in vaccinating its public, resulting in extended lockdowns of the population and continuing closures of businesses.
The European contraction, however, was less than the 1 percent expected by authorities.
By contrast, the U.S. economy grew 1.6 percent during the first quarter, driven by strong consumer demand. On an annualized basis, the U.S. grew at a rate of 6.4 percent.
For Europe, this is the second straight quarter of falling output, and experts warn that the continent has fallen back into a recession. At the same time, other officials spoke with growing confidence about the expected economic growth in April and May.
Also, there was some good economic news in Europe. France reported growth of 0.4 percent, compared to the quarter before. However, experts were surprised by Germany, where the economy shrank by a larger-than-expected 1.7 percent. It was noted that the German manufacturing sector suffered a slowdown due to disruptions of parts supplies.
French authorities are cautiously optimistic, as they say larger segments of the population are being vaccinated against COVID-19. Additionally, lockdown restrictions are slowly being lifted, as outdoor terraces of French cafes and restaurants will be allowed to reopen on May 19, along with museums, cinemas, theaters and concert halls, while practicing Covid precautions.
However, Italy, Spain and Greece are bracing for the loss of the second summer tourist season.
