Saturday, August 16, 2008

European economies crumbling

The economies of Germany, France and Italy all contracted in the first quarter and may now be in full recession, shattering assumptions that Europe would prove able to shrug off the effects of the credit crunch.

The picture is darkening so fast in Spain that Prime Minister Jose Luis Zapatero cancelled holidays and called his cabinet back to Madrid for the first emergency session of its kind since the Franco dictatorship.

Growth has turned negative in Ireland, Denmark, Latvia, and Estonia, while grinding to a halt in Sweden and The Netherlands.

The oil shock over the early summer appears to have had a dramatic effect on the heavy industries of Japan and Germany.

Spain’s finance minister Pedro Solbes says “The economic situation is worse than we all predicted.”

[The Telegraph]

No comments: