Why Italians Might Be Economic Losers in Era of Euro

Updated on
  • Italy only euro nation to see per-capita GDP drop since 1998
  • Germans easily top the league table in the 19-nation zone

Almost two decades after the creation of the euro single currency, Italians are proving to be the big losers among the 19 member countries.

Gross domestic product per capita in real terms shrank 0.4 percent in the last 18 years, according to Bloomberg calculations based on data from the European Union statistics office up to 2015 and estimates for 2016. While Italy’s economy expanded 6.2 percent since 1998, its population increased by 6.6 percent over the period -- thus accounting for the per-head drop.

Too Slow

“The comparison with other countries clearly shows that the Italian economy has expanded at too-slow a pace over the period,” said Loredana Federico, an economist at UniCredit Bank AG in Milan. “It will be very difficult for Italy to close, in the years to come, the gap with other economies that already returned to the pre-crisis level or even surpassed it.”

Eleven members of the EU introduced the euro as an accounting currency in January 1999; they were later joined by Greece. The actual notes and coins were introduced in January 2002, and expansion of the zone has since continued, with Lithuania becoming the 19th member in 2015.

Italy’s per-capita GDP has fared even worse than Greece, which was severely hit by the financial crisis. The value of all goods and services produced in that country rose in the last 18 years by 4 percent on an individual basis, Bloomberg calculations show.

In Germany, the euro region’s largest economy, per-capita output rose by 26.1 percent since 1998. That makes the citizens of Chancellor Angela Merkel’s nation the winners among all of the bloc’s main economies.

— With assistance by Mark Evans

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