Eastern Europe Shows Green Shoots as Germany Recovers - by Zoltan Simon
East Europe’s economies, most of which endured record output declines last quarter, look poised to start recovering from recession in the second half as key export markets in western Europe return to growth. Industrial production contracted at a slower pace in Hungary, the Czech Republic, Romania, Latvia, Lithuania and Slovakia in June, helping the Slovak and Czech economies to grow last quarter from the first three months of the year.
Eastern Europe’s export-reliant economies need a western European recovery to revive their manufacturing sectors and spur job growth. After Germany and France exited their recessions last quarter, prospects have brightened for a resurgence of demand that might help the region’s emerging economies expand. “We see a good chance that the economic decline has already bottomed out in the region,” said Laszlo Bencsik, Chief Financial Officer at OTP Bank Nyrt., the Hungarian lender with units in Bulgaria, Croatia, Montenegro, Romania, Russia, Serbia, Slovakia and Ukraine.
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