Consequences of the Euro-Zone’s Declining Economy

As unemployment rises, another quarter of recession looms for the European economy. On Friday, February 21 some nations reported missing their government deficit targets despite many rounds of spending cuts. The region’s economy is expected to grow later this year, but during the last three years the 17 country union has been the slumps. The Obama administration is concerned about the effect of  the European Union’s declining economy on the United States. In his State of the Union Address at the beginning of February 2013, President Obama mentioned  free-trade talks with the European Union in an effort to promote American and European trade. The key question is whether such an arrangement will be primarily pursued to address trade issues or whether its main purpose is the foundation of a political counterbalance to China.

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