Recent assessments show that conflicts in Ukraine and the Middle East heighten risks to the European economy. The autumn outlook highlights these geopolitical tensions as key variables that could influence the EU’s financial performance. Russia’s ongoing military actions in Ukraine contribute to broader instability in the region, while disruptions to energy supply in the Middle East may ripple through European energy markets, posing new challenges for policymakers and businesses alike.
The European Commission stresses that the EU’s economic outlook could suffer further from a slowdown in China, a major trading partner. External threats are now viewed as more pronounced due to the evolving situations in Ukraine and the Middle East, prompting a cautious reassessment of growth and resilience across member states.
In a parallel update, the EC revised its GDP projections for Russia. The latest data indicate a modest growth path for Russia, while the overall trajectory toward the end of the year signals a contraction. The Commission also identifies a group of ten economies that face a risk of recession in the near term, underscoring the broader regional impact on global growth and trade flows.
Earlier indicators pointed to substantial losses in Ukraine’s economy in the previous year, reflecting the deep impact of conflict on production, investment, and exports. The cumulative effect of these pressures reverberates through supply chains and market confidence, influencing investment decisions and credit conditions across Europe.