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Cloudy Outlook for Growth in Emerging Europe and Central Asia

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Growth in the Emerging Europe and Central Asia (ECA) region remains tepid, with GDP growth for the region expected to be only 1.8 percent in 2014 and improving slightly up to 2.1 percent for 2015, the World Bank said during the 2014 World Bank/IMF Annual Meetings.

“The Emerging Europe and Central Asia region is facing some daunting challenges amid a cloudy outlook for growth,” said Laura Tuck, Vice-President for the World Bank’s Emerging Europe and Central Asia region. “The tensions in Ukraine have clearly had an impact on the country’s growth and have disrupted economic activity. But many of the structural problems that confront countries in the region existed before the crisis and still need to be urgently addressed.”

Added Tuck, “While we monitor the impact of the Ukraine crisis on the region, it is important not to lose sight of these longer-term issues that countries need to tackle to boost growth and create badly needed jobs. In many countries of Central and Eastern Europe, the challenge is to finally put the economic crisis behind – to kickstart the financial sector and improve the business climate. In the Balkans, deepening institutional reforms and improving governance are crucial. In Russia and many neighboring countries, key are reforms to enhance competitiveness and create sources of growth beyond oil and gas.”

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Signs of recovery

Some signs of hope show through in the region. Central and East European (CEE) countries are expected to see growth accelerate to 2.5 percent in 2014 and to 2.8 percent in 2015 – a significant improvement from the previous two years when growth was very modest (0.8 percent in 2012 and 1.3 percent in 2013). But recovery in the new EU member states remains mixed and growth in Western Europe is disappointing.

Unemployment rates in several countries have peaked and are now showing signs of improvement. While they remain above 10 percent in several CEE countries, they are declining the most in countries such as Estonia, Latvia, and Lithuania, where structural reforms and prudent policies were implemented swiftly. Given past trends, these positive developments are expected to be reflected in higher income growth for the bottom 40 percent of the population.

In the Western Balkans, economic growth is expected to drop from 2.4 percent in 2013 to only 0.6 percent in 2014, due to its debt overhang that is reducing financing for business and lack of reform momentum, and then recover modestly to a projected 1.9 percent in 2015.  

Ukraine crisis

Meanwhile, in Ukraine, geo-political tensions have developed into a deep crisis for the country. Recent trends point to a sharper decline in Ukraine’s real GDP in 2014 and continued retrenchment in 2015 compared to earlier projections. Ukraine’s GDP is expected to contract 8 percent in 2014 and 1 percent in 2015.

The conflict in the east has disrupted economic activity, made collection of taxes difficult, adversely affected exports, and hurt investor confidence. Meanwhile, weak revenue performance, rising spending pressures, and a growing Naftogaz deficit make fiscal adjustment more challenging. The current account deficit has adjusted because of the sharp depreciation, but balance of payments pressures remain high due to large external debt refinancing needs, low FDI, and limited access to external financing. A prolonged confrontation in the east, constrained credit supply due to risks in the banking sector, constrained domestic consumption, and investment demand all pose risks and affect prospects for recovery.

Russian stagnation

In Russia, the World Bank warned earlier this year of an unfinished transition, including ongoing problems in the business environment and heavy reliance on oil revenues. Currently, the Russian economy is slowing as its past growth drivers have weakened. GDP growth in Russia was just 0.8 percent in the first half of 2014, compared to 0.9 percent in the first half of 2013.

Economic activity was already hamstrung in 2013 by lingering structural problems and a wait-and-see attitude on the part of both businesses and consumers. An additional negative impact on the economy – besides slow structural reforms – came from increased geopolitical tensions and an uncertain policy environment. It is policy uncertainty about the economic course the country will take that is casting the longest shadow on Russia’s medium-term prospects. There is a greater need for reforms to enhance the business climate to build avenues for growth and less reliance on the energy sector.

The Commonwealth of Independent States (CIS) economies have faced headwinds due to the crisis in Ukraine and ongoing stagnation in Russia, however broad spill-overs to other countries have been limited so far. Immense reliance of the CIS economies on energy exports persists, and progress on structural reforms has slowed. Growth for these countries is expected to be a meager 1 percent in 2014 and to rise only slightly to 1.3 percent in 2015.

In Turkey, growth has also slowed from over 4 percent in 2013, but is projected to stabilize at about 3.5 percent in 2014 and 2015.

Going forward

“The forecast for the Emerging Europe and Central Asia region remains tepid because of deferred structural reforms, as well as ongoing weak growth in Western Europe and stagnation in Russia,” noted Hans Timmer, Chief Economist in the World Bank’s Emerging Europe and Central Asia region. “Economic growth in the region remains lower than in most other regions of the world. Going forward, the emphasis should be on improving governance and the investment climate, strengthening competitiveness, ensuring the stability of the financial sector, and maintaining a sound macroeconomic framework.”

“To be sustainable in the longer term, economic growth and shared prosperity need to be fiscally affordable, environmentally responsible, and conducive to social inclusion,” said Timmer.

The World Bank, working jointly with other World Bank Group institutions, is helping its client countries in Emerging Europe and Central Asia address these and other challenges to reduce poverty and boost shared prosperity through policy dialogue, analytical work, project funding, and reimbursable advisory services.

 

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Apostolos Tzitzikostas, EPP candidate, elected as new President of the European Committee of Regions: “Together, we must make our Committee the bridge between Europe and its citizens”

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© Apostolos Tzitzikostas Twitter

Governor of the Region of Central Macedonia and EPP CoR member, Apostolos Tzitzikostas,  was elected as new President of the European Committee of Regions.

“Together, we must make our Committee the bridge between Europe and its citizens”, transmitted the new CoR president in his speech.

 

Apostolos Tzitzikostas wants a change of the European Committee of the Regions and presented to the new colleagues a plan based on three pillars: Modernizing the administration, a focused dialogue between citizens and the European Union and establishing an agenda in order to ”make this Committee the point of reference in the European Union.”

The February 2020 plenary session represents the inaugural session for the European Committee of the Regions’ seventh’ term of office.

The European Committee of the Regions is the EU’s assembly of regional and local representatives. Since 1994 its mission has been to represent and promote the interests of local and regional authorities in relation to the European decision-making process. From its Brussels headquarters, the European Committee of the Regions has thus helped to ensure ever closer union of the European nations and territories with decisions being taken at the closest possible level to ordinary Europeans, in line with the subsidiarity principle.

The New Mandate

CoR members and alternates are appointed for 5 years, which is the length of a CoR mandate. The next mandate starts on 26 January 2020 and will last until 25 January 2025. At the beginning of a new mandate, all CoR members have to be appointed, and all organs, including the Bureau, the commissions, the working groups, and the interregional groups have to be re-established. A new President, a new First vice-President and a new Bureau are elected by the members meeting in the first plenary session.

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Head of Romanian EPP MEPs responds to S&D Group leader: Treat Romania differently. You cannot compare PSD’s attacks against the rule of law with EPP Government measures

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© European Parliament Media Center

The actions undertaken against the rule of law by the former Social-Democrat governments in Romania cannot be compared with recent measures announced by the centre-right government, member of EPP family, says MEP Rareș Bogdan, head of the Romanian delegation within the EPP Group in the European Parliament.

In an exclusive statement for CaleaEuropeană.ro, Bogdan responded to critics drawn by Iratxe Garcia, leader of the Socialists and Democrats in the European Parliament. In a Twitter post earlier on Monday, Garcia said EPP Romanian government should take note of Venice Commission, which prohibits changing the electoral law one year ahead of the elections.

The Spaniard MEP advised the Romanian Government against going the ”same path as Poland and Hungary” in ”undermining the rule of law”.

In his reaction, Rareș Bogdan mentioned that we would ask for a discussion with ”Mrs. Garcia to clarify that her statement was made without knowing the reality in Romania and the steps taken by the Orban government”.

“I think there is no bad will, but a simply less unfortunate information about the situation in Romania”, he replied.

”There is no term of comparison” between PSD and PNL, said Bogdan, ”although both parties are from Romania”.

”You cannot compare the continuous attack of PSD against Romania’s strategic partnerships with the EU and the US, against the rule of law (…) with the natural, logical and normal proposal of PNL, using constitutional tools, to introduce a two rounds vote for the local elections in June 2020. The purpose of our proposal is to enhance the representativeness and legitimacy of the elected local politician. By introducing a two rounds election we do not reduce, in any case, electoral rights”, explained the head of the Romanian delegation in the EPP Group.

Moreover, Rareș Bogdan asked that the situation in Romania to be treated ”differently”, considering Garcia’s comparison with the situations in Poland and Hungary.

“My request is that our colleagues in the European Parliament treat Romania as a different situation. Also, pay close attention to the statements of the leaders in Bucharest, led by President Klaus Iohannis and the right-wing Prime Minister Ludovic Orban, who have no connection with the statements made by Romanian officials at the head of the Government or Parliament in the period 2017-2019”, said Bogdan.

 

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Take part in the #EUCanBeatCancer campaign. EPP group urge the Member States to join forces and fight cancer together

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© EPP/ Facebook

EPP Group, the largest political family in the European Parliament, is launching a cancer awareness campaign, the disease that causes one of four deaths in Europe.

Through #EUCanBeatCancer campaign, the EPP group calls for better cooperation between research centers in Europe, more money for cancer research, but also fair and accessible care across Europe for citizens.

© EPP/ Facebook

How can you get involved in the #EUCanBeatCancer campaign

You can join the 1537 citizens already registered in the campaign through 4 simple steps:

  1. You subscribe using the email address HERE
  2. Follow the #EUCanBeatCancer campaign on Facebook, Instagram and Twitter
  3. Use the Twibbon  in the profile picture
  4. Draw the Twibbon symbol and post it in order to show support

Everyone has their own story about cancer, even European politicians or leaders:

 

 

 

 

 

 

 

According to the World Health Organization, one third of cancers are preventable and half of the deaths could be prevented.

Breast cancer is the second most common form of cancer in Romania and in many cases the disease is detected when it is already in an advanced stage.

According to the private health network, Regina Maria, in Romania, 80% of breast cancers are diagnosed in the advanced phase, a stage in which the treatment can not bring healing, but only prolong the survival.

Romania had the lowest rates  (0.2% of women aged 50-69 – 2015) in breast cancer screening.

 

Our multimedia platform – Calea Europeana – has joined the #EUCanBeatCancer campaign. During the campaign informative articles will be published and we will keep you updated with the measures taken at European level to beat cancer.

© CaleaEuropeana

 

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