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News : EU Economy Last Updated: Dec 16, 2010 - 3:33 PM


Ireland’s GDP per head was 27% above EU average in 2009
By Finfacts Team
Dec 16, 2010 - 2:50 AM

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Ireland’s gross domestic product (GDP) per head was 27% above the EU average in 2009, despite the severe recession, data published on Thursday showed.

In 2009, the GDP per inhabitant in Luxembourg, expressed in purchasing power standards (PPS)*, was more than two and a half times the EU27 average, while the Netherlands recorded a level more than 30% above the average. Ireland,Austria and Denmark were between 20% and 30% above the EU27 average, while Sweden, Germany, Belgium,Finland and the UnitedKingdom were between 10% and 20% above average.

France, Italy andSpainregistered GDP per inhabitant between 0% and 10% above the EU27 average, while Cyprus and Greece were between 0% and 10% below the average.

Slovenia, the CzechRepublic, Portugal, Malta and Slovakia were between 10% and 30% lower than the EU27 average. Hungary, Estonia, Poland, Lithuania and Latvia were between 30% and 50% lower, while Romania and Bulgaria were between 50% and 60% below the EU27 average.

GDP in Ireland is about 20% above GNP (gross national product) because of the inclusion of the profits of the dominant multinational sector.  Ireland was 47% above the per inhabitant EU average in 2007. 

Eurostat says while Ireland does maintain its position as one of the richest EU member states in terms of GDP per capita, this is not fully reflected in the country's level of consumption.

The agency says while GDP per inhabitant is often used as an indicator of countries' level of welfare, it is not necessarily a suitable indicator for households' actual standard of living. For the latter purpose, a better indicator may be Actual Individual Consumption (AIC) per inhabitant.

Generally, GDP and AIC per inhabitant are highly correlated, because a country with a high level of welfare as measured by GDP will also have a high potential for consumption. However, in some cases, this correlation is not so obvious.

For example, while the GDP per inhabitant in the United Kingdom was 12% above the EU average in 2009, its AIC per inhabitant was 25% above the average, and thus the second highest in the EU. Conversely, Ireland's GDP per inhabitant was 27%t higher than the average, while its AIC per inhabitant was only marginally above the average EU level.

The data for 2009, 2008 and 2007, published by Eurostat, the statistics office of the European Union, are based on revisedpurchasing power parities, and the latest GDP and population figures. They cover the 27 EU Member States, three EFTA (European Free Trade Association) member states, three EU candidate countries and four Western Balkan countries.

  • The high GDP per inhabitant in Luxembourg is partly due to the country's large share of cross-border workers in total employment. While contributing to GDP, these workers are not taken into consideration as part of the resident population which is used to calculate GDP per inhabitant.

  • Eurostat says the Purchasing Power Standard (PPS) is an artificial currency unit that eliminates price level differences between countries. Thus one PPS buys the same volume of goods and services in all countries. This unit allows meaningful volume comparisons of economic indicators across countries. Aggregates expressed in PPS are derived by dividing aggregates in current prices and national currency by the respective Purchasing Power Parity (PPP). The level of uncertainty associated with the basic price and national accounts data, and the methods used for compiling PPPs imply that differences between countries that have indices within a close range should not be over-interpreted.

  • Eurostat, Statistics in Focus, 62/2010, "Major dispersion in GDP per inhabitant across the EU". In addition to GDP per inhabitant, this publication also includes data on Actual Individual Consumption per inhabitant, an alternative welfare indicator listed among the recommendations of the Stiglitz-Sen-Fitoussi report. The publication is available free of charge in PDF format on the Eurostat website.

  • The regular publication schedule of PPPs includes four estimates for a particular year. The first estimate for 2009, based partly on projections, was published in News Release 91/2010 of 21 June 2010. The present News Release corresponds to the second estimate. The 2009 figures will be revised again in December 2011 and finalised in 2012.

  • The Eurozone (EA16) consists of Belgium, Germany, Ireland, Greece, Spain, France, Italy, Cyprus, Luxembourg, Malta, the Netherlands, Austria, Portugal, Slovenia, Slovakia and Finland.

* On PPS, Eurostat says for example, if the price of a hamburger in France is €2.84 and in the United States it is $2.20, the PPP for hamburgers between France and the United States is €2.84 to $2.20 or €1.29 to the dollar. In other words, for every dollar spent on hamburgers in the United States, €1.29 would have to be spent in France in order to obtain the same quantity and quality – or volume – of hamburgers.

GDP per inhabitant in PPS, EU27 = 100

 

2007

2008

2009

EU27

100

100

100

Eurozone (EA16)

109

109

109

       

Luxembourg

275

280

271

Netherlands

132

134

131

Ireland

147

133

127

Austria

123

124

124

Denmark

123

123

121

Sweden

125

122

118

Germany

116

116

116

Belgium

116

115

116

Finland

117

118

113

United Kingdom

116

115

112

France

108

107

108

Italy

104

104

104

Spain

105

103

103

Cyprus

93

97

99

Greece

91

93

93

Slovenia

88

91

88

Czech Republic

80

81

82

Portugal

78

78

80

Malta

77

77

79

Slovakia

68

72

73

Hungary

62

64

65

Estonia

69

68

64

Poland

54

56

61

Lithuania

59

61

55

Latvia

56

56

52

Romania

42

47

46

Bulgaria

40

44

44

       

Norway

179

189

178

Switzerland

140

143

145

Iceland

121

122

118

       

Croatia

60

64

65

Turkey

45

47

46

Former Yugoslav Rep. of Macedonia

31

34

36

       

Montenegro

40

43

41

Serbia

33

37

37

Bosnia and Herzegovina

29

30

31

Albania

23

26

27

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