MADRID (AFP) — The crisis in the US subprime mortgage market will not have a discernable effect on on EU growth in 2007, EU Economic and Monetary Affairs Commissioner Joaquin Almunia said here Monday.
"It should not cause a major surprise for the European growth figure," Almunia told an economic forum in Madrid.
But he estimated that the fallout from the subprime lending crisis would slightly dent growth in 2008 "to the tune of a few percentage points."
Almunia added that this year, growth was likely to remain similar to 2006 levels, when the figure for the eurozone was between 2.7 and 2.8 percent.
"I do not believe there will be any major surprises for growth through to the end of 2007," he said, while adding that in contrast for the coming year he thought risk factors had increased.
Earlier, Almunia told El Pais newspaper he believed that European growth had a "solid foundation" and so would not unduly be buffeted by the subprime crisis.
Economy Minister Pedro Solbes said last week he similarly believed the subprime would not greatly affect Spain.
"The recent turbulence in global financial markets are taking place within a context of solid economic growth in Spain and the impact on the Spanish financial sector will be extremely reduced," he told a news conference.
Spain itself, turning in higher than eurozne average growth in recent years, expects 2007 economic growth to ease to 3.8 percent from 3.9 percent last year.
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