The trade of the EU was hit hard by the Coronavirus pandemic

EU news monthly

Politics

The European Commission has initiated legal proceedings against Britain over the former EU Member State’s postponement of introduction of controls on goods destined for Northern Ireland. According to the EU executive, less than three months after completing its departure from the European bloc, London is violating the terms agreed in the exit agreement. Britain argues that it has only temporarily postponed the checks and is not breaking the rules.

The transfer of the current Prime Minister, Igor Matovič, to the Ministry of Finance should end the crisis in the Slovak government, to which personal disagreements between government politicians have contributed. The Minister of Finance Eduard Heger has been entrusted with forming a new government.

Greece will offer government bonds with the longest standard maturity of 2052. This will be the first time since the financial crisis. The southern European state is trying to raise funds in this way to combat the coronavirus crisis, which has hit the country whose economy is primarily based on tourism very severely. Athens needs 11.6 billion euros to fulfil its economic recovery plans.

The EU and the United States have agreed to suspend the tariffs they have imposed on each other in the dispute over subsidies for aircraft production at Airbus and Boeing for 4 months. This was announced by EC President Ursula von der Leyen after a telephone conversation with US President Joe Biden.

Economy

In the fourth quarter of 2020, seasonally adjusted GDP decreased by 0.5% in the EU compared with the previous quarter. The decline follows a strong rebound in the third quarter of 2020 (+11.6%) and the sharpest decreases since the time series started in 1995 observed in the second quarter of 2020 (-11.2% in the EU). For the year 2020 as a whole, GDP fell by 6.2% in the EU, after +1.6% in 2019.

EU annual inflation was 1.3% in February 2021, up from 1.2% in January. A year earlier, the rate was 1.6%. The lowest annual rates were registered in Greece (-1.9%) and Slovenia (-1.1%), the highest annual in Poland (3.6%) and Hungary (3.3%). Compared with Janua-ry, annual inflation fell in ten Member Sta-tes, remained stable in three and rose in fourteen.

In 2020, the trade of the EU was hit hard by the coronavirus pandemic, with significant falls observed for both exports (-9.4%) and imports (-11.6%) compared with 2019. In 2020, the EU trade in goods balance was in surplus by €217 billion.

In the fourth quarter of 2020, hourly labor costs rose by +3.3% in the EU, compared with the same quarter of the previous year. In the third quarter of 2020, hourly labour costs increased by +1.8%. In the EU, the costs of hourly wages & salaries increased by +3.7% and the non-wage component by +1.8% in the fourth quarter of 2020.

In January 2021 compared with December 2020, seasonally adjusted production in the construction sector increased by 0.9% in the EU. In December 2020, production in construction fell by 1.3% in the EU. In January 2021 compared with January 2020, production in construction decreased by 1.8%.

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