"Britain will suffer a deeper recession than any other mature EU economy, with a contraction of 1% next year and only 0.4% growth in 2010, the European commission said today.
The EC's latest half-yearly forecast predicts UK unemployment will rise from 5.3% in 2007 to 7.1% in 2009 — which would bring the number out of work to about 2.25 million.
It expects the budget deficit to jump to 5.6% next year, which would be around £80bn, and 6.5%, or £94bn, in 2010. Government debt is forecast to rise by more than 15 percentage points to more than 60% of GDP in 2010-11. The figures would break stability and growth limits set by the EU's stability and growth pact.
The bleak EU forecasts blow a hole in the government's assertion it has been running the EU's model economy for the past decade.
Britain's contraction will be worse even that that of Ireland, which is forecast to shrink 0.9% in 2009 but recover to 2.4% growth in 2010. Ireland's budget deficit is forecast to be higher, at 6.8% of GDP in 2009 and 7.2% in 2010.
Only Estonia and Latvia are expected to suffer deeper recessions in 2009, contracting 1.2% and 2.7% respectively. Germany, France and Italy, the eurozone's three biggest economies, are expected to stagnate."
Oddly the BBC report on the same subject, headlined "Eurozone is on verge of recession", does not mention that the UK is predicted to fare so badly. Now why would that be? Could it be that the BBC is trying to protect Gordon Brown's reputation as the saviour of the world economic system and the greatest Chancellor of the Exchequer, from the light of the facts?
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