MONEY MATTERS

Political uncertainties, currency fluctuations and economic recessions have made the going tough for most IT firms in the European markets. The second quarter ended June 2010 has been a drop of business for IT firms in Europe. Though the entire European economy is going slow, countries such as Germany and France have been showing an improvement. These two countries have been adding positive growth to the total GDP of Europe. However, uncertainties in certain countries like Portugal, Ireland, Greece and Spain will have some impact on Europe’s economy.
It is predicted by analysts that there will be a growth of 1 – 2% in Europe’s GDP in 2010. Most analysts hope that the IT sector will return to growth in 2010. The IDC predicts that the Western Europe external IT services market will grow to $204 billion in 2010 and further to $232 billion in 2011. The currency fluctuation and conversion have been important reasons for the Indian IT companies’ setback. With all the uncertainties, it is believed that in the medium-to-long-term, the European market can create lot of opportunities for Indian players. The players who are able to invest in European Union markets keep in mind the marginal and long-term growth factor that will benefit them.

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