The joint hosting by Poland and Ukraine of this summer’s Euro 2012 football championships was a sign of the coming of age of the host countries. But as the sporting spotlight fades and the short-term economic and confidence boost recedes, the underlying economic challenges these countries and the rest of central and eastern Europe face will come back to the fore. Hit hard by the seemingly endless eurozone financial crisis, weak economic growth globally and elsewhere in Europe adversely affecting exports, and deleveraging by western banks, CEE economies have in the past year broadly stalled and in some cases shrunk. UniCredit expects the region’s growth at the end of this year to fall to about 2.7% (it was 3.7% in 2011 and 3.5% in 2010) with possible subsequent recovery to between 3% and 4%. But if the long-term regional trend remains one of relatively strong economic growth, the confluence of factors affecting the region’s performance is unlikely to dissipate in the near future, and might even worsen in the coming months. |
