All about business

Inflation has surpassed unemployment as the top concern among European citizens, whose confidence in the outlook for their national economies plunged in early 2008, according to a survey released by the European Commission.

The poll of more than 30,000 people across Europe “shows an important shift downward in the confidence Europeans place in their national economy,'' the commission, the EU executive in Brussels, said in a statement today. “EU citizens now consider inflation as the most important issue in their country.''

Forty-six percent of respondents said the situation of their national economies “will be worse'' in the next 12 months, according to the poll, conducted March 25-May 4. That is up from 26 percent in the previous survey, which was released in December. Sixteen percent of respondents said they believe the economic climate will improve in the next year, down from 24 percent earlier.

The Eurobarometer poll showed that 37 percent of citizens consider inflation to be “the most important issue'' in their countries, up 11 percentage points. Twenty-four percent name unemployment as the top concern, down from 27 percent.

While the jobless rate in the euro area has fallen to a record low 7.1 percent, inflation accelerated to 3.7 percent last month, the highest since 1992, on soaring food and energy prices. The European Central Bank in Frankfurt has signaled it may raise borrowing costs in July as policy makers set aside concerns about the economy's expansion to focus on inflation http://paydayintime.com.

`Positive Image'

Almost half of European citizens, 48 percent, have a “positive image'' of the EU, while 15 percent have a negative image, the survey showed. Ireland, which rejected the proposed EU treaty in a referendum this month, had the second-highest positive opinion on the EU, at 65 percent. Romania was highest with 67 percent.

“The referendum was not about membership in the European Union,'' commission spokesman Joe Hennon told reporters in Brussels today. “You'll have to ask the Irish people why'' they voted against the treaty, he said, adding that the positive image of the EU “has been relatively stable for quite a long time'' in the semi-annual Eurobarometer surveys.

Overall support for EU membership fell to 52 percent in the latest poll from 58 percent earlier. Half of EU citizens “tend to trust'' the bloc, while 32 percent place more trust in their national governments, according to the latest poll.

The survey showed 44 percent of respondents say the 27- nation EU protects them from the negative effects of globalization, while 35 percent disagree.

“These results reflect the current economic difficulties and show the need for the EU to continue with its policy agenda aimed at improving the quality of people's daily lives,'' Margot Wallstrom, vice president of the commission, said in the statement.

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