The European recovery is gaining momentum according to Grant Thornton's International Business Report (IBR). However, drawing on interviews with more than 1,100 regional executives, The Future of Europe 2015 (pdf) uncovers a number of threats, from Greek debt negotiations to high unemployment, which continue to undermine European stability and long-term business growth prospects.
Europe has made some serious economic progress made over the past 12 months. The EU economy posted growth of 1.4%, not spectacular by historical standards, but a significant improvement from 2013. Having contracted, on an annual basis, for two years in a row, the eurozone grew by 0.9% last year. And both regions are expected to accelerate in 2015.
These improving growth prospects, alongside greater economic certainty and the decision by the European Central Bank (ECB) to launch a programme of quantitative easing have all helped create a much more fertile environment for businesses growth.
Regional business optimism is higher than the global average for the first time in close to four years and many of the economies which required bailouts at the height of the crisis, such as Ireland and Spain, are now firmly back on track.economy posted growth of 1.4%, not spectacular by historical standards, but a significant improvement from 2013. Having contracted, on an annual basis, for two years in a row, the eurozone grew by 0.9% last year. And both regions are expected to accelerate in 2015.
Clearly Europe is still grappling with a number of challenges from the threat of deflation and still-high debt to high unemployment and the rise of populist parties. But there is a growing sense that the economy has turned a corner, strong enough to deal with Greece exiting the single currency should negotiations break down irrevocably and ready again to take a lead in global development and innovation.
