France’s economic performance since the 2007 crisis is regularly compared to that of Germany. Where does France, along with its European peers, stand in terms of wealth created per capita since 2007?
In 2015, according to the United Nations, per capita wealth was 13% higher in Germany than in France, whereas in 2004 the two countries were at virtually the same level (1% higher in Germany). Did the 2007-2008 crisis make things worse? The map above shows the relative change in GDP per capita between 2007 and 2015 compared to Germany, in constant prices, i.e., adjusted for inflation. It shows that:
– Eastern European countries, led by Poland (+20%), generally outperformed Germany, benefiting from a catch-up effect that has continued since their accession to the European Union.
– Among the countries most affected by the crisis in Europe, three groups clearly stand out: Greece, whose per capita wealth fell by 30% compared to Germany between 2007 and 2015; Italy, Spain, and Portugal, whose per capita wealth underperformed Germany’s by 10 to 15 percentage points; Ireland, which ultimately outperformed Germany’s economic performance by 10% between 2007 and 2015.
– France has seen its per capita wealth grow more slowly than Germany’s since the crisis, with the gap widening by 7 percentage points between 2007 and 2015. France’s performance in this respect is comparable to that of other core eurozone countries, such as Denmark (-8%), the Netherlands (-7%) and Belgium (-6%).
– The monetary independence of Norway (-9%) and the United Kingdom (-6%), which are not part of the eurozone, does not appear to be associated with better economic performance compared to Germany. Both countries are struggling to outperform France in terms of per capita wealth growth.
Nevertheless, the weakness of the French economy compared to that of Germany may mask certain differences over time. For example, France may be better able to absorb negative shocks such as those seen in 2007-2008, but may be slower to benefit from growth once it returns.
In terms of per capita wealth, France did indeed outperform Germany between 2007 and the end of 2009 (in the eurozone, growth picked up again in Q3 2009). But only by 0.4%. Nevertheless, apart from Belgium and the Netherlands, which created nearly 1.5% more wealth per capita over this period, most other Western European countries were much more affected by the crisis (-2.5% for the United Kingdom, -3% for Italy, -6% for Luxembourg compared to Germany).
– As for the rebound in per capita wealth in France since the end of 2012 compared to Germany, it was 2.4 percentage points lower for France. The situation is similar for Belgium, but even less favorable for Italy, which is 4.4 percentage points behind Germany. Similarly, Finland, Norway, and Sweden have recorded a smaller or similar increase in per capita wealth to that of France. It should nevertheless be noted that the countries of Northern Europe have a per capita wealth that is 10 to 90% higher than that of France.
T.D.
