The MIDE model is based on two different hypotheses, one optimistic and the other pessimistic. The first speculates that the USA and British economies will soon come out of the recession and that the European economies will grow when the last trade barrier are lifted. The revitalization of the eastern European economies may also contribute to the growth in foreign demand. In the pessimistic scenario (numbers between brackets), the economies in recession do not recover and the effects of factors likely to stimulate the single European market are felt later and to a lesser extent. As a result, foreing demand grows much less than in the above forecast, as do exports.

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                     1990     1991     1992     1993     1994     1995
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GDP growth rate.......3.67     2.89     2.55     2.87     2.96     3.56
                                       (1.97)   (1.99)   (1.78)   (2.39)

Private consumption
deflator..............6.43     5.63     4.03     3.13     3.48     3.88
                                       (3.80)   (2.72)   (2.87)   (3.54)

External deficit (1)
as a percentage of
GDP..................-2.64    -2.38    -2.06    -1.86    -1.82    -1.78
                                      (-2.06)  (-2.15)  (-2.47)  (-2.79)

Unemployment rate
as a percentage of
active population....16.25    15.90    15.60    14.85    14.31    13.40
                                      (16.37)  (16.00)  (15.00)  (15.00)
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Notes: (1) Net exports at current prices.
         * The results of the "hard landing" hypotheses, with lower export
           growth, in brackets.
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