EU says economy will stall in 2012

BRUSSELS, Feb. 23 (UPI) -- The European Commission said Thursday that the economy in Europe would fall flat in 2012 with the eurozone dropping into a "mild recession."

After a "weak" third quarter of 2011 and a 0.3 percent drop in the fourth for the 27-member European Union, the Commission said in its Interim Forecast report for the year that "Growth for 2012 is now expected to be zero for the EU and minus 0.3 percent for the euro area."

The figures are a downgrade from the fall, when the Commission forecast 0.6 percent growth in the EU and 0.8 percent in the eurozone, the 17-member region that uses the euro as currency.

The Commission said "a return to the kind of modest recovery that is typical for the aftermath of financial crises is expected only in the second half of the year."

"The EU is set to experience stagnating GDP this year, and the euro area will undergo a mild recession," the report's summary noted.