Europe's economy lost steam in late 2005, but European Union finance ministers and economists today forecast an upturn would arrive this year.
As the ministers met in Brussels, Germany said its economy stayed flat in the final three months of last year - news that followed France's announcement on Friday that it was close to stagnation in the same period.
Preliminary data from the Federal Statistics Office showed the German economy stagnated in the last three months of 2005 because of declines in private and government consumption that offset stronger investment.
Growth in the 12-nation euro zone as a whole ended the year as poorly as it started, with a preliminary estimate by the Eurostat statistics office showing a GDP rise of 0.3 per cent in the October-December period after two stronger quarters.
Growth in the euro zone was so far believed to have slipped to about 1.3 per cent for 2005 from 2.1 in 2004 and is forecast by the European Commission to hit at least 1.9 per cent, perhaps even 2.2 per cent, in 2006.
European Economic and Monetary Affairs Commissioner Joaquin Almunia said he remained "cautiously optimistic" about prospects for recovery despite poor figures from France and Germany.
Figures issued last Friday showed French GDP rose just 0.2 per cent in the fourth quarter compared with the previous three months, far less than the 0.7 per cent of the third quarter.
But the Bank of France forecast a pickup in the second-biggest euro zone economy in early 2006. Official GDP reports were somewhat better in Spain and The Netherlands, with a pickup in the quarter-on-quarter pace of expansion to 0.9 per cent in Spain in the last three months of 2005 and a Dutch pickup to 1 per cent.