EU’s newest members in Eastern Europe return to growth but rebound is weak, World Bank says

World Bank: EU’s newest members return to growth

BRUSSELS — The 10 Eastern European nations that have joined the EU since 2004 are seeing economic growth again for the first time since the start of the global financial crisis in 2008, the World Bank said Friday.

It said that in the first quarter of 2010, Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, and Slovenia posted an average growth of 0.8 percent, up from a 2.1 percent slump in the last quarter of 2009.

“Nevertheless, the recovery is weak,” the World Bank said in a summary of a report to be published next week.

“It will take until next year before real output in the 10-nation region regains its pre-crisis level, and for a few it is likely to take slightly longer.”

The World Bank publishes a report on the EU’s 10 newest members three times a year, monitoring economic developments and analyzing key policy issues.

The full July report will be available on the bank’s web site next week.

In the summary, the World Bank said growth is returning more slowly to western EU nations. Output there rose by only 0.6 percent on average in the first quarter of 2010.

Growth in eastern EU countries will likely accelerate to 1.7 percent in 2010 and 3.6 percent in 2011 — more than double the forecast for western EU members.

However, the upswing in Eastern Europe is uneven, the World Bank cautioned. In the first quarter, it was strongest in the Slovak Republic and Poland, less so in Hungary and the Czech Republic. Economies contracted in Latvia, Bulgaria, Lithuania, Romania, and Estonia.

“What remains essential for the region’s recovery is to safeguard financial market stability, and increase fiscal efficiency,” said the World Bank.

Online:

www.worldbank.org/eca/eu10rer

www.worldbank.org