Ilustratīvs attēls no pixabay.com.
We are used to the tiresome East-West divide in terms of GDP per capita – the fact that the eastern European countries of the EU are still poorer than most of their western European compatriots.
Increasingly, however, it is worth thinking (also) in terms of a North-South divide. The financial crisis and its aftermath has seen strongly diverging developments in the north of the EU vis-à-vis the south and I try to illustrate that with a couple of graphs. These diverging developments should be worrisome for the future of the EU and not least the future of the Eurozone.
In Figure 1 I try to compare the GDP development during the crisis (1st axis) with the GDP development after the crisis (2nd axis). As we know, the Baltic countries took the biggest hit during the crisis (= far to the left on the 1st axis) – with Latvia hit the hardest – but all three have also made strong comebacks (= high up on the 2nd axis). Other strong performers in this way are e.g. Romania and Slovakia as well as Malta and Luxembourg (in both cases influx of population have helped) and Sweden (some will say due to their floating exchange rate). Poland is in a class of its own with growth during the crisis (i.e. no crisis due to no credit boom in the first place) and growth afterwards.
