The European Commission (EC) expects the GDP of the eurozone, as well as the European Union as a whole, to grow at 2.7 percent this year and by 2.3 percent next year – down from its previous winter forecast of 4 percent this year and 2.8 percent in 2023, the Commission said.
"The biggest impact on the global and EU economies is on energy commodity prices. Although they have risen significantly even before the war [in Ukraine], from the low levels recorded at the time of the pandemic, uncertainty about supply chains has pushed prices up while increasing their volatility. Food and other basic goods and services are affected, and household purchasing power is declining," the report reads.
War-induced logistics and supply chain disruptions, as well as rising production costs for a wide range of raw materials, are further compounded by global trade disruptions caused by the drastic COVID-19 containment measures still in place in some parts of China, which are taking a toll on production.