Economy, Eu | featured news

Thousands of workers protested in Brussels on Thursday to demand that EU leaders gathering for a summit bring an end to austerity measures and instead focus on boosting growth and reducing unemployment.

The European Union's official economists predicted the euro-zone economy will shrink in 2013 for the second year in a row and for the third year of the past five, in a forecast that sees little hope that easing financial-market tensions in the region will provide a jolt to the real economy any time soon.

Leaders resumed talks on a trillion-euro budget for the European Union on Friday, but played down expectations of a resolution before the weekend as divisions lingered on where cuts should be applied.

Europe's economy is still reeling and unemployment could remain high for years despite the progress made in solving the debt crisis, the European Union warned Wednesday, as it downgraded next year's forecasts for the 27-country bloc.

In spite of years of harsh spending cuts and tax increases, Europe's debt problems are getting worse. Figures from the EU's statistics office Wednesday showed that, at the end of the second quarter, the total government debt of the 17 countries that use the single currency was worth 90 percent of the group's total economic output for the year - the highest level since the euro was launched in 1999.

European Union officials pushed on Saturday to accelerate moves to stem the bloc's long debt crisis as Italian premier Mario Monti warned that economic suffering was fuelling divisive nationalism on the continent.

Germany and the European Commission on Tuesday called on EU nations to stick to their promised budget cuts despite mounting voter discontent, but promised some new efforts to boost growth to alleviate economic hardship.

The European Union will call on China this week to boost domestic demand and on the United States and Japan to tackle their public deficits as part of global efforts to rebalance growth, an EU document showed.

The European Commission on Monday outlined the potential new measures it is considering to ensure that short-selling of stocks and bonds doesn't destabilize financial markets or national economies.

Greece reached agreement with the European Union and the International Monetary Fund on rescue loans to keep Athens from defaulting on its debts, a deal that will impose harsh cuts on the county's 11 million people for years.