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| Version 4 | Version 5 |
|---|---|
| Europe's major economies contract | Europe's major economies contract |
| (20 minutes later) | |
| The 15 economies of the eurozone contracted by 0.2% between April and June, heightening fears that the euro area is sliding towards recession. | |
| The German economy, Europe's largest, shrank by 0.5% in the second quarter compared with the first three months of the year, the first decline since 2004. | The German economy, Europe's largest, shrank by 0.5% in the second quarter compared with the first three months of the year, the first decline since 2004. |
| And in both France and Italy GDP shrank by 0.3% in the second quarter. | And in both France and Italy GDP shrank by 0.3% in the second quarter. |
| The downturn was largely driven by a decline in exports and a slowdown in consumer spending. | The downturn was largely driven by a decline in exports and a slowdown in consumer spending. |
| The slowdown was less pronounced in the wider European community of 27 nations including the UK, which contracted by 0.1%. | |
| However Estonia, where the economy contracted for the second consecutive quarter, is now officially in recession. | |
| Compared to the second quarter of 2007, the eurozone economies grew by 1.5% and the 27 European Union countries grew by 1.7%. | |
| 'Deterioration' | |
| SECOND QUARTER GDP GROWTH Germany: -0.5%France: -0.3%UK: +0.2%Italy: -0.3%Spain: +0.1%EU15: -0.2%EU27: -0.1%Source: Eurostat | |
| Exporters have been affected by the strength of the euro, which makes their products more expensive overseas, and a more general slowdown in global demand. | Exporters have been affected by the strength of the euro, which makes their products more expensive overseas, and a more general slowdown in global demand. |
| French finance minister Christine Lagarde, said the decline in the French economy in the second quarter "mostly reflects the deterioration of our international context, which particularly weighed on our exports and which is common to all European countries". | French finance minister Christine Lagarde, said the decline in the French economy in the second quarter "mostly reflects the deterioration of our international context, which particularly weighed on our exports and which is common to all European countries". |
| "The fundamentals of the French economy are healthy," she added. | "The fundamentals of the French economy are healthy," she added. |
| Meanwhile a German finance minister said its economy could contract again in the next quarter which would mean Germany was officially in recession. | |
| "At the moment that cannot be ruled out," said deputy economy minister Walther Otremba. | "At the moment that cannot be ruled out," said deputy economy minister Walther Otremba. |
| 'Orders down' | |
| Germany was once seen as the main driver of growth in the eurozone. | Germany was once seen as the main driver of growth in the eurozone. |
| However exporting companies, such as Berlin-based manufacturer Witels Albert, are cutting back after seeing orders decline in the last few months, especially from the US. | However exporting companies, such as Berlin-based manufacturer Witels Albert, are cutting back after seeing orders decline in the last few months, especially from the US. |
| "There is a slowdown in the industry and one of the main reason is the rise in oil price," chief executive Horst Schneidersreit, told BBC News. | "There is a slowdown in the industry and one of the main reason is the rise in oil price," chief executive Horst Schneidersreit, told BBC News. |
| "We have seen this in our own company. Our orders have slowed down." | "We have seen this in our own company. Our orders have slowed down." |
| Despite the sharp slowdown in the second quarter in Germany, the government said it still expected GDP growth of 1.7% this year. | Despite the sharp slowdown in the second quarter in Germany, the government said it still expected GDP growth of 1.7% this year. |
| Spain was the only one of the major eurozone economies to see its economy expand between April and June. It grew by 0.1% compared with the previous quarter. | Spain was the only one of the major eurozone economies to see its economy expand between April and June. It grew by 0.1% compared with the previous quarter. |