(AGENPARL) – Fri 20 June 2025 EU’s projected economic growth insufficient to meet global challenges
(Brussels, 20 June 2025)
Ahead of next week’s European Council meeting, BusinessEurope has just released its new Economic Outlook which forecasts slower than expected economic growth in the EU. Commenting on the publication, BusinessEurope Director General Markus J. Beyrer said:
“A strong economy is the cornerstone of the EU’s ability to meet its internal goals and assert itself on the global stage. Our new Economic Outlook projects that the EU economy will grow by a modest 1% in 2025 and 1.4% in 2026. Given the current geopolitical uncertainty, this growth will not be sufficient to ensure the EU’s global competitiveness.
Our 2025 growth forecast has been revised downward amid increased global economic unpredictability and the disruptive impact of new U.S. tariffs. With external trade accounting for 22.4% of the EU’s GDP in 2023, the EU is particularly vulnerable to disruptions in global trade flows. The U.S. remains the EU’s largest individual trading partner, and the additional tariffs present a significant external shock to the European economy. The EU must respond to this global trade volatility by diversifying source and destination markets through new trade agreements, while prioritising a mutually beneficial, negotiated solution with the U.S.
At the same time, the EU should boost intra-EU trade and competition by reducing Single Market barriers, along with simplifying and harmonising taxation rules. This must coincide with the EU going further in its simplification efforts to reduce the administrative burden for companies across the EU. The EU must also strengthen its efforts to lower energy costs and increase the EU’s energy resilience by investing in energy infrastructure and production capacity and diversifying its energy sources.
Moreover, the development of the European security and defence industry can be a key factor in supporting competitiveness while responding to geopolitical risks.”
To read BusinessEurope’s latest Economic Outlook in full, click here.
ENDS
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