According to Eurostat’s estimate, to which cited by Euronews, eurozone GDP in the first quarter of 2026 grew by just 0.1% year-on-year and only 0.8% year-on-year.
The EU as a whole fared slightly better, with plus 0.2% quarter-on-quarter and 1.0% year-on-year. However, both values lag behind the US, where GDP grew by 2.7% in annualized terms over the same period.
However, a small group of economies are sharply pulling away from the average.
Cyprus tops the table at 3.0%
The EC’s 2025 forecast attributes this to strong growth in private consumption, accelerating EU-supported investment and a record tourism season.
The Commission forecasts GDP growth of 2.6% in 2026 and 2.4% in 2027, which is markedly above the eurozone average.
However, pressure on energy markets is testing inflation, labor market dynamics and fiscal policy.
Annual total inflation accelerated from 0.9% in February to 1.5% in March and 3.0% in April.
Tourism, which accounts for about 14% of Cypriot GDP, is most at risk. In March, the number of tourists decreased by 30%.
At the same time, a budget surplus of €573.3 million, or 1.5% of GDP, was recorded in the first quarter of 2026.
Bulgaria’s economy grows by 2.9%
Bulgaria’s economy grew by 2.9% in the first quarter of 2026, the second fastest in the EU.
The European Commission’s forecast envisages real GDP growth of Bulgaria by 2.7% in 2026 and by 2.1% in 2027 due to EU funds, defense investments and sustainable private consumption.
However, warnings about the quality of this growth are growing louder. IMF Managing Director Kristalina Georgieva characterized the situation as “overheated”: wages are growing faster than productivity, credit is expanding rapidly, and housing prices are skyrocketing.
The IMF estimates that switching to the euro could bring Bulgaria’s per capita income to the EU average within a decade, but only if budgetary and structural reforms are implemented.
According to Eurobank Research analysts, the budget deficit reached 3.5% of GDP in 2025. Expenditures grew by 13-14%, exceeding the ceiling of 6.2% set by the plan.
Eurobank warns that a significant part of this growth, especially in terms of personnel costs, raises the likelihood of launching an excessive deficit procedure against Bulgaria starting in 2027.
Spain leads among major economies with growth of 2.7%
In the first quarter of 2026, the country’s GDP grew by 0.6% quarter-on-quarter and 2.7% year-on-year.
The contrast with the other Eurozone heavyweights is stark: over the same period, Germany added only 0.3% in annualized terms, France – 1.1%, Italy – 0.7%.
According to BBVA Research estimates, Spain’s GDP in 2025 grew by 2.8%, and in 2026 and 2027 is expected to grow by 2.4% annually.
The bank attributes this to absorption of funds, sustained immigration, and increased defense and infrastructure investment. At the same time, labor productivity has barely grown since 2019, housing supply is still not keeping pace with demand, and government debt is approaching 100% of GDP.
