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29 November, 2021

European Commission Forecast: What Will Happen To The Region's Economy In The Next Two Years

The GDP of EU countries will grow by 5% by the end of 2021. Most countries will reach pre-pandemic levels, while others will fully recover in 2022.

We tell you what the European Commission sees as the reason for the recovery of the region's economies and what its forecast is for countries with investment programmes.

Residence permits in the European Union: an economic forecast from the European Commission
Photo: Adobe Stock

The European Commission forecasts the same GDP growth for the eurozone, a region of 19 states that use the euro as their main currency. In 2022, GDP growth for both regions will be slower, increasing by around 4.3%. In 2023, GDP growth of the European Union will decrease again to 2.5% and that of the eurozone to 2.4%.

GDP trends in the EU and Eurozone in 2021, 2022 and 2023
Source: European Economic Forecast, October 2021

The European Commission notes four main factors that have helped the EU economy recover to 2019 levels.

Mass vaccination against coronavirus. EU states started vaccinating residents in 2020. About 50% of the region’s population has been vaccinated against the coronavirus. Malta is considered a world leader in vaccination, with 84% of its citizens vaccinated.

Opening the borders to tourists. Most European countries have allowed travellers to enter. Foreigners with a valid reason for travel, such as medical treatment, can enter closed countries for tourists. Where Russians can fly during a pandemic, we tell you in this updated digest.

Implementing an economic recovery and sustainability plan. The EU has a Recovery and Resilience Fund: it helps to mitigate the economic and social impact of the pandemic and helps states transition to a 'green economy'.

The labour markets are improving. Some 1.5 million new jobs were created in the EU in the second quarter of 2021. Many people found jobs through job retention programmes. The overall unemployment rate has fallen, but it is still below pre-pandemic levels.

The European economy is moving from recovery to expansion, but it now faces headwinds. This positive picture is threatened by three main factors: an increasing number of coronavirus cases, rising inflation, and supply chain disruptions putting pressure on states.

Paolo Gentiloni
European Commissioner for Economic Affairs

Forecast for 2021 for EU countries

Growth and recovery are proceeding at different speeds, with the slowest recovery coming from states whose borders are still closed to tourism.

The European Commission has mapped out the region's GDP growth forecast for the end of 2021. The biggest growth is forecast for Croatia, Greece and France - over 6%. The smallest is in Germany, where growth will be only 2.7%.

Map of projected GDP growth in the EU states at the end of 2021

EU GDP growth forecast for 2021
Source: European Economic Forecast, октябрь 2021

Economic outlook for countries with investment programmes

Greece, Cyprus and Malta are the most attractive countries by investment in 2021-2023. The European Commission predicts that the GDP of these countries will grow more than the regional average.

Projected GDP growth in countries with residence permits and permanent residence permits by investment

Country2021 year2022 year2023 year

Greece's economy is recovering fast through tourism: The country was one of the first to open its borders to foreigners. Demand for goods at home has also increased in Greece. The European Commission noted the effectiveness of the state's fiscal policy, which supports businesses and the population in the crisis.

A residence permit in Greece is granted by purchasing a property worth €250,000 or more. Participants in the programme purchase a residence or commercial property, rent a hotel or tourist apartment for 10 years, buy a bond or open a deposit in a bank.

Cyprus will show stable GDP growth in 2021, 2022 and 2023. The country's fiscal policy has boosted domestic demand for goods. Cyprus has also opened its borders to tourists, which has had an immediate impact on rapid economic growth.

A permanent residence permit in Cyprus is granted by investment of €300,000 or more. The investor buys real estate, shares in local companies or units of investment funds.

Malta had one of the worst results at the end of 2020: the tourism sector suffered because of closed borders and the economy shrank by 8.3%. But by the end of 2021 Malta's economy will have grown by 5% - a high figure for the European Union.

The state's fiscal policy has proved to be effective: the country's domestic demand for goods and net exports have increased. In 2022 the country's GDP will increase by 6.2%, which will be the best result in the EU. Malta could reduce public debt in 2023.

A residence permit in Malta is granted by  investment of €112,000 or more. The investor buys or rents a house on the island, pays an administrative fee and a government fee, and makes a donation to a local non-profit organisation. The investor also confirms the existence of assets worth €500,000 or more.

The investor buys or rents a house on the island, pays an administrative fee and a government fee, and makes a donation to a local non-profit organisation. The investor also confirms assets of €500,000 or more.

Portugal depends on tourism, but so far the country has only opened up the island of Madeira to foreigners. The European Commission believes that Portugal's economy will start growing faster with the resumption of international tourism. For now, the state's fiscal policy has increased local employment and domestic demand for goods. 

Residence permits can be obtained in Portugal under the state programme for:

  • investment in real estate;opening a deposit in a local bank;
  • the purchase of shares in venture capital funds;
  • the financing of scientific research and cultural projects;
  • contribution to an existing business;
  • setting up a new company headquartered in Portugal.

The minimum investment amount is €250,000 to finance cultural projects. But the most popular option with investors is the purchase of real estate worth €500,000 or more.

Austria suffered losses in the winter of 2020-2021 when popular ski resorts were closed due to quarantine. The gradual lifting of restrictions, vaccination and government support helped Austria's economy recover faster than predicted in the European Commission's winter report.

Residence permits in Austria are issued on a quota basis to financially independent persons. There are only 450 quotas per year. In order to obtain the quota, it is necessary to prepare the documents in advance.

The EU residence permit allows wealthy people to move to the country of residence, conduct business and study there. And with a residence permit or residence permit card, you can travel freely to all Schengen countries.

Immigrant Invest is a licensed government programme agent that helps you obtain a residence permit by investment in European countries. If you want to move to Europe and travel freely in the Schengen area, seek advice from experts in investment programmes.

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European Commission Forecast: What Will Happen To The Region's Economy In The Next Two Years