The updated GfK Purchasing Power Europe 2010 / 2011 study by market research
firm Gfk reveals the regional distribution of the population's purchasing power in
42 European countries. This year's study suggests the beginning of a recovery
from the economic and financial crisis.
According to the GfK study, European consumers have a net household income of
approximately €7.9bn available for consumer purchases in 2010. This
corresponds to an average purchasing power of €11,945 per inhabitant of the 42
countries considered by the study. This is an increase of around 2.1% over the
previous year's level.
The crisis has definitely left its mark in some countries. There are however
no major shifts in the purchasing power levels of the wealthier countries
evaluated by the study, with the exception of Sweden. Here per capita purchasing
power rose significantly due to the revised 2009 figures and 2010 exchange rate
fluctuations. Even so, Sweden's purchasing power lags behind Finland's.
The Baltic countries, which bore the full brunt of the financial crisis,
slipped further in 2010 despite improvements to Europe's overall economy. With a
per capita purchasing power of €4,938, Estonia fares best among the Baltic
The countries comprising former Yugoslavia as well as Moldova, the Ukraine and
Belarus continue to occupy the lowest ranks: Inhabitants of these areas have
less than one-third of Europe's average purchasing power. Exceptions are Croatia
and Slovenia. In recent years, Slovenia has climbed to the top of the rankings
among the Baltic countries and even overtook Portugal in the crisis year of
2009. Slovenia has consolidated this position in 2010 with a per capita
purchasing power of €10,045.
Portugal, Italy, Ireland, Greece and Spain fall in the middle of Europe's
purchasing power rankings. All of these countries have purchasing power levels
that have remained relatively stable since last year's study. A few countries
are already enjoying a clear upswing. Turkey is among those European countries
that successfully weathered the economic crisis and achieved positive economic
development in 2010. Turkey's per capita purchasing power consequently rose by
over 10%, moving it up several places in the rankings.
Purchasing power is a measure of per capita disposable income (including any
received state benefits) after the deduction of taxes. The study indicates
annual per person purchasing power levels in euros and as an index value. GfK
purchasing power figures reflect the nominal disposable income, meaning that the
values have not been adjusted for inflation. The study draws on statistics on
income and tax levels, government benefits and forecasts by economic institutes.
The GfK purchasing power study does not take into account regional
cost-of-living variations or recurring monthly deductions from disposable income
such as rent, mortgage payments and contributions to private retirement funds
and insurance policies.