The economy in the eurozone is finally doing well. After extensive quantitative easing by the European Central Bank, the economies in the area have grown faster than the United States economy, CNN Money reports. At the same time, the unemployment has reached a nine-year low.
The eurozone economies (an area where euro was adopted) grew 2.4 percent in 2017, a bit faster than the American economy. According to Stephen Brown, an economist at Capital Economics, the business sentiment in Europe points to higher growth in the upcoming months. In fact, business confidence in the region is at 17-year high.
In France, the economic growth looks promising. Quite possibly, the growth of the French economy will surpass that of Germany. French President Macron is looking to loosen strict labor laws, reduce corporate taxes, and lower the budget deficit by reducing the public sector. Whether that really happens is yet to be seen.
There is some political uncertainty in Europe, though. German Chancellor Angela Merkel is having troubles forming a coalition government, while Brexit brings more uncertainty. At the same time, Spain has to deal with issues related to declaration of independence by Catalonia, while Greece continues to struggle under debt burden.
Overall, the unemployment figures in the region don’t look bad, especially 3.6 percent unemployment rate in Germany. But, when it comes to Spain, the rate stands at nearly 17 percent. So, not every country in the eurozone is benefiting from good economic times in Europe.
In news that will generate further interest in the European and Israeli startups sector and economy at large, a Luxemburg-based investment firm raised millions of dollars to invest in the Israeli and European economies. The Mangrove V set up by Mangrove Capital Partners raised up to $170 million to invest in the extraordinary and novel technologies emerging from these economies. While the investment fund seems relatively smaller compared to the sums raised by other investment firms for the same purpose, Mangrove Capital Partners’ management believes that it has a great potential of realizing higher returns. Mangrove Capital Partners is the latest investment company to have trained its eyes for the emerging startup markets in Israel and Europe. Others such as Index Ventures, EQT Ventures and Atomico Ventures had earlier laid down markers with a combined investment fund of over $3 billion.
The latest investment forays in the startups in Israel and Europe portend greater economic gains for the startup sector in the target markets and their economies at large. The forays have the potential of improving economic growth and job creation in the economies. It is also an indication of the fast growth of Israeli’s startup sector, which has already seen many startups acquired by big corporations in deals worth billions of dollars. Mobileye recently set the pace in the sector when it was acquired in a deal worth a mouth-watering $15 billion by Intel. It will motivate local innovators to develop revolutionary ideologies that will hit the magical and coveted $1 billion mark in acquisition fees. For Mangrove Capital Partners investors, the recent successes with startups acquisition in Israel should ease their mind when it comes to getting a return on their investments. The company’s investments in two startups in one of the world’s fastest growing hi-tech economy saw the company realize over a hundred fold return on investment.