Page 16 - Economic report 2020

growth than in the previous year (+4.4%). The The slowdown in the Chinese economy
reason is the upward trend in oil prices, which limits the growth of emerging economies.
has benefited oil-exporting countries such as
Saudi Arabia, Iraq and Iran. Finally, the block
of Latin America and the Caribbean saw growth of 3.9% which, despite being lower than the
7.0% of the previous year, is considered to be a relatively positive rate, thanks to the good trend
in prices of commodities, of which it is a major exporter.

In the group of developed economies, the
GDP GROWTH - Annual variation rates, in % slowdown in GDP in the USA was notable, going
Chart 1.2 from growth of 5.9% in 2021 to 2.1% in 2022,

clearly below the Eurozone growth estimated
by Eurostat (+3.3%), something which had not
happened since 2017. The two main factors
that explain this lower economic growth in the
USA are private consumption (+2.8% in 2022,
well below the +8.3% in the previous year) and
investment (-0.5% in 2022); these components
were affected by the significant rise in interest
rates, which was higher in the USA than in the
USA Eurozone Eurozone in 2022. Equally, the US labour market
f: IMF forecasts (July 2023). is showing great resilience, as demonstrated
Source: IMF. by the US unemployment rate falling to 3.5%
in December 2022, the lowest in the last two
The Eurozone economy grew decades, which is helping to maintain the high
14
more than that of the USA. inflationary pressures due to the upward trend
in wages. Finally, the reduction in the public
deficit was very significant (from 12.1% of GDP
in 2021 to 4.2% in 2022, according to the Organisation for Economic Cooperation and Development,
OECD), which occurred as a result of the withdrawal of the major economic incentives available to
businesses and citizens during the pandemic and also due to the effect of the GDP rise on the ratio.

In 2022, the Eurozone economy slowed less than that of the USA, thanks to lower interest rates
External environment of the Andorran economy | I. International economy
and the support of both the NextGenerationEU funds and the fiscal plans approved by member
states. According to Eurostat, GDP in the Eurozone-19 grew 3.3% in 2022, compared with 5.4%
in 2021. Despite the high dependency on Russian gas and oil, the Eurozone stocked up reserves
and substituted Russian gas with liquid gas
from the USA, mainly, thereby avoiding supply The European economy appears
risks for winter 2022-2023. resilient, thanks to the good trend
in the labour market.
Despite the difficulties, the European economy
has shown itself to be resilient in 2022,
through the good trend in the labour market, which continued to create jobs at a good pace
– the unemployment rate of the Economic Monetary Union (EMU) reached a historic low of
6.7% in December – and the fiscal measures taken by the governments to help households and
businesses to cope with inflation. Although these measures were effective for mitigating the effect
of inflation on activity, the international organisations have demanded that they be temporary and
focus on the groups impacted most negatively, especially if they might compromise public debt
sustainability.

According to Eurostat, growth in 2022 was especially strong – over 5.5% - in Ireland, Malta,
Portugal, Greece, Cyprus and Spain. But of these countries, it was only equal or higher than