Eurozone’s industry plummets

 
Tim Wallace
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INDUSTRIAL output collapsed in the Eurozone in November, official figures revealed yesterday, leaving economists certain the currency area is mired in recession again.

Yet International Monetary Fund chief Christine Lagarde argued that the Eurozone has turned a corner and that the economy is on the mend.

“We forecast the Eurozone to be delivering growth in 2013, which is better than the recession that it has experienced in 2012,” she said in an interview broadcast on the BBC’s World Service.

“There is an improvement, and there is the beginning of recovery.”

But her optimism stands at odds with the official figures from Eurostat, which showed a continued fall in industrial output.

Production was down 3.7 per cent on the same month of 2011 – a steeper fall than the 3.3 per cent drop recorded in October, the data revealed.

On the month, production fell 0.3 per cent. By country Italy is the worst hit with industrial output down 7.6 per cent, closely followed by Spain’s 7.2 per cent decline.

Ireland’s industrial production dropped 6.6 per cent on the year, while Greece’s slid 3.1 per cent.

Even Germany saw its output fall three per cent, though a few countries recorded growth, led by Estonia with a 6.5 increase.

“The latest survey evidence indicates that the sector is still in recessionary territory and that conditions continue to be tough going into 2013,” said economist Howard Archer from IHS Global Insight.

“Specifically, the latest purchasing managers survey indicated that overall Eurozone manufacturing activity contracted for a 17th successive month in December.”

“Any significant recovery in Eurozone manufacturing activity still looks some way off.”

The grim output data came after figures showing Eurozone unemployment hit a record high in November.

Joblessness climbed to 11.8 per cent, accounting for 18.82m people.