Table of Contents
The overall growth sentiment in Western Europe is taking a positive turn; however, a few economies, such as Italy and France, still pose a threat to the region’s growth.
Private consumption momentum, investor confidence, and competitive reforms are likely to push the country out of recession, by 2015. However, high public debts and poor exports will continue to challenge the economy.
The country is expected to see the much-awaited first signs of growth in 2015. Although improved investor confidence and new projects across the major industries are likely to boost growth, exports will be the main driver in 2015.
The United Kingdom
The United Kingdom is likely to experience significant improvement in exports, investor sentiment, and inflationary trends. The energy sector is forecast to boom by H2 2015, accompanied by steady growth in the manufacturing sector, until 2016.
A promising manufacturing sector and a favourable investment climate are likely to steer economic growth in Germany. The country is also expected to see a significant improvement in its employment opportunities.
Spanish economy is likely to outpace the current average rate of growth in the euro zone. A strong domestic demand is expected to boost the rate of growth in 2015 while the fear of deflation and the ever high unemployment rate loom at large in the economy.
Regional Growth Sentiment, 2015
•Western Europe is expected to experience positive growth in 2015. While France and Italy are likely to level out contraction and experience the first signs of growth, other major economies, such as Spain, Germany, and the United Kingdom, are anticipated to gain further growth momentum.
•The region’s manufacturing sector is expected to perform well in 2015 when compared to the last x recessionary years. Increasing external demand due to the strong growth in the United States and Asia, accompanied by equally robust domestic demand in Spain and Germany, will fuel growth in Europe in 2015.
•Exports will continue to serve as the main engine of growth in Spain, Germany, and Italy. However, over-dependence on exports alone will cost a few of the major economies (for example, Germany) their immunity against the economic volatility in the region.
Regional Industry Summary
•Due to consistent external demand and effective product innovation, the European chemicals sector has been able to shield itself from the harsh recession in the region. With internal and external demand picking up, the sector is expected to record positive growth in 2015. Most of the growth in the German, Italian, and Spanish economies will be attributed to the chemicals sector.
•The automotive sector continues to sustain growth in the region. All the major economies, including France, Germany, Italy, Spain, and United Kingdom, are likely to see good production and sales growth in 2015, especially in the small car segment. In 2015, the automotive sector is anticipated to be one of the highest value adds to the regional GDP.
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