Eurozone disaster laid bare by devastating new chart – Brussels pays price for Covid farce

France lockdown: Paris students queue for food parcels

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And Emmanuel Macron’s France, which lags far behind the UK in terms of the number of COVID-19 jabs administered, was particularly badly hit, witnessing a drop of nearly five percent. The data, published by Eurostat, the bloc’s statistics division, will pile more pressure on beleaguered European Commission President Ursula von der Leyen, who has faced widespread criticism as a result of the EU’s sluggish vaccine rollout.

The volume of industrial production in the eurozone fell by one percent month-on-month in February.

February’s figure marks a return to contraction, following growth of 0.8 percent in January, and represents the largest fall in industrial output since April 2020, when restrictions were at their tightest.

As a result, analysts with the UK-based Centre for Economic and Business Research (CEBR) have revised their forecasts for eurozone GDP downwards, with growth of four percent now anticipated across 2021.

While European manufacturers have adapted to the current lockdown restrictions, they are not exempt from global economic headwinds

Oliver Gatland

CEBR economist Oliver Gatland said: “While European manufacturers have adapted to the current lockdown restrictions, they are not exempt from global economic headwinds.

“The contraction in industrial output during February reflects not only the impact of ongoing coronavirus restrictions but also soaring import prices due to supply chain disruption across the eurozone.”

However, he added: “Despite our downward revision for eurozone GDP growth to four percent in 2021, we expect any growth to coincide with an increase of industrial output, especially in the second half of the year.”

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The monthly change in industrial production volumes varied between the eurozone states.

Some actually witnessed increased industrial output, with the biggest improvement being seen in Ireland, amounting to 4.2 percent.

However, such rises were outweighed by a number of other countries experiencing contractions in output.

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France and Malta have exhibited the largest declines, of 4.8 percent and 3.8 percent respectively.

In France, the figures will be particularly galling for Mr Macron who may have hoped his country had turned the corner, given January figures revealed an increase in production of 3.4 percent.

The CEBR’s analysis suggests while factories across Europe have adapted to current restrictions and are able to operate more efficiently than at the start of the pandemic, they are not exempt from global economic headwinds.

For example, shipping container shortages led to soaring import prices earlier this year, affecting access to both finished goods and components across Europe.

Combined with continued disruption to global semiconductor supply chains, the result has been restricted output possibilities.

Meanwhile, the EU has been widely criticised for its slow vaccine distribution so far, which have necessitated strict lockdown measures necessary to keep the third wave under control, not least in France.

In turn, such restrictions have had a profound impact on domestic demand for goods across Europe while, in the meantime, other areas of the world – including the UK – are returning to some sort of normality.

While France and Germany are making efforts to step up their vaccination programmes, the reimplementation of lockdown measures across many member states presents a considerable short-term hurdle and will likely delay the return of economic activity, CEBR’s analysis warned.

Speaking at the start of the month, Mr Macron warned France would “lose control if we do not move now”, introducing restrictions including the closure of non-essential shops, and shutting schools for three weeks after Easter.

By way of explanation he said “the numbers are charging away from us” with France now faced with “a race against the clock”.

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