GDP is the main thermometer of the size and growth of the economy of a country. This has traditionally been reflecting the value of the goods and services produced within a country And it is something that allows us to compare the performance between regions. But, if lately it has been more on everyone’s lips, it has been for the Ukraine Warby the REQUIREMENT OF US ADMINISTRATION in terms of defense and for the European rear. Given this, it is interesting to take an eye on the situation in Europe, comparing the GDP of their countries and regions to have a more global idea of the economy of the neighbors.
And this graph shows it perfectly.
The pizza. Prepared by Visual Capitalist and using the International Monetary Fund As a source, we can see in a very clear way the size of the economy of the different countries.
But there is something important to take into account: if the GDP of any of these countries does not fit you (that of Spain, for example, it was 1,593,136 million euros in 2024 and there it says that it is 2,800,000 million dollars, the fault has the parity of purchasing power.
Parity of what? PPA -Parity of purchasing power or PPP in English- is a correction that allows us to compare more directly the price of goods and services between countries. The graph has been prepared by adjusting the GDP by PPA, which allows the size and purchasing power of the different economies.
What is this for? In order to measure what can really be purchased locally instead of directly transforming GDP to the international standard change, which is usually the US dollar. Thus, and using an exchange rate that eliminates the distortions of the different currency markets, the panorama is more fairly compared. In short: Economies with undervalued or overvalued coins with respect to the dollar are represented in a more adjusted way to reality and the standard of living, economic well -being and real size of the economies can be better compared.
By zones. Given this, we see that, apart from Russia, Germany, the United Kingdom and France, there are more aligned economies such as Italy, Spain, Poland or Netherlands, those four above 1,000 billion dollars, and then the rest of the countries. But, if we distinguish in zones, we see the enormous weight of the aforementioned Russia and Germany.
The western zone has a GDP adjusted per PPA of 14,800,000 million dollars for the 12,800,000 of the Eastern Europe. The southern Europe (curiously the so -called ‘Pigs’) with Italy, Spain, Portugal or Greece has that adjusted GDP of 8,300,000 million and that of the north (including the United Kingdom and with Sweden, Ireland, Denmark, Norway or Finland) with a GDP per PPA of 7,800,000 million.
Unequal growth. When the nominal GDP is measured, the thing changes. Western Europe would continue first with a GDP of 11,000,000 million, the north with 6,500,000 million, the south with 5,200,000 million and Eastern Europe is the one that falls loudly with 4,600,000 million. Reason? Adjected to the PPA, Russia occupies a huge portion of the cake, but the nominal GDP relegates it to the middle part of the table with a GDP of 2,100,000 million.
These regional disparities are what has historically marked a two -speed economic development. Europe has been adjusted and changes for a few years. In that panorama, Russia Lithuania, Iceland or Montenegro are from the countries that grow the most this year. Luxembourg, Ireland or Estonia, decrease. Others grow (Spain), and we see cases such as France or Germany in stagnation.
In general, the growth From the Eurozone it was 0.7% and the European Union of 0.8%, but we must see how situations such as external factors, structural tensions or industrial slowdown in some countries to the photo of the European GDP of 2025.
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