The European Commission has predicted that the economic recovery in the euro-zone will accelerate this year, despite weak growth in the last quarter of 2003.

Economic growth in the last quarter of 2003 was 0.3 per cent quarter on quarter, down from 0.4 per cent in the previous quarter.

The Commission expects the euro-zone economy to grow by 0.3-0.7 per cent in each of the first two quarters of 2004. A Commission spokesman said that the forecast reinforced the Commission's optimism about the euro-zone economy. "The outturn for the fourth quarter and the forecast for the first two quarters of 2004 confirm our confidence in an acceleration of economic growth in 2004," he said.

The euro-zone economy grew by 0.4 per cent in 2003 after growth picked up half-way through the year. The Commission expects the euro zone to grow by 1.8 per cent in 2004 but the European Central Bank has forecast growth of just 1.6 per cent.

Economic growth is especially weak in the euro zone's three biggest economies, with 0.1 per cent growth in Germany in 2003, 0.2 per cent in France and no growth at all in Italy.

"All of this is a reminder that we should not yet rely on the upswing in Europe - it is not yet secure," said Mr Thomas Mayer, chief European economist at Deutsche Bank in London.

Separate figures show Italy's economy stalled in the final quarter of 2003, falling far short of analysts' expectations and helping slow Europe's growth rate.

The euro zone's third-largest economy was battered by strikes, a strong euro and a massive scandal at food group Parmalat, which eroded consumer confidence and domestic demand.

Gross domestic product was unchanged in the final quarter compared with the previous quarter and grew 0.1 percent year-on-year, preliminary data from national statistics agency Istat showed.