ECONOMY OF EUROPE

(Redirected from European economy)

'Economy of Europe'
During 2003 unless otherwise stated

Population:	710,000,000
GDP (PPP):	US$ $12.82 trillion (2006)
GDP/capita (PPP) :	$29,300
GDP /capita (Currency) :	$30,937
Annual growth of per capita GDP:	2.8% (2006)
Income of top 10%:	27.5%
Millionaires:	2.6 million (0.3%)
Unemployment	8.8% (2006)
Estimated female income	56.7% of male
Most numbers are from the UNDP from 2002, some numbers exclude certain countries for lack of information. Statistics are for entire nations, not just the portions within Europe.

The 'economy of Europe' comprises more than 710 million people in 48 different states. Like other continents, the wealth of Europe's states varies, although the poorest are well above the poorest states of other continents in terms of GDP and living standards. The difference in wealth across Europe can be seen in a rough East-West divide. Whilst Western European states all have high GDPs and living standards, many of Eastern Europe's economies are still emerging from the collapse of the USSR and former Yugoslavia. Throughout this article "Europe" and derivatives of the word are taken to include selected states that are geographically in Asia, bordering Europe - such as Azerbaijan and Cyprus.
As a continent, Europe has the largest economy in the world. Europe's largest national economy is that of Germany, which ranks third globally in nominal GDP, and fifth in purchasing power parity (PPP) GDP; and its second is that of the United Kingdom, which ranks fifth globally in nominal GDP and sixth in PPP GDP. The European Union is the world's largest (as determined by the IMF and the World Bank - 2005) or second largest economy (CIA World Factbook - 2006) if counted as a single unit -- see List of countries by GDP (PPP).

Contents

Economic development

Pre-1945: Industrial growth

1945-1990: The Cold War era

The rise of the EU

2004-2007: EU expansion

Regional variation

Trade blocs

European Union

European Free Trade Association

European Economic Area

Commonwealth of Independent States

Central European Free Trade Agreement

Currency and Central Banks

Stock exchanges

Economic sectors

Agriculture and fishing

Manufacturing

Investing and banking

Global trade relations

Economy by country

References

See also

Economic development

Main articles: Economic history of Europe

Pre-1945: Industrial growth

Prior to World War II, Europe's major financial and industrial states were the United Kingdom, France, Germany and Italy. The Industrial Revolution, which began in Britain, had spread rapidly across Europe, and before long the entire continent was at a high level of industry. World War I had briefly led to the industries of some European states stalling, but in the run-up to World War II Europe had recovered well, and was competing with the ever increasing economic might of the United States of America.
However, World War II caused the destruction of most of Europe's industrial centres, and much of the continent's infrastructure was laid to waste.

1945-1990: The Cold War era

Following World War II, Europe's economy and infrastructure was in tatters. The vast majority of Eastern European states came under the control of the USSR in what became the Council for Mutual Economic Assistance (COMECON), and therefore a communist market-system (Yugoslavia also adopted this type of market-system but it was not USSR-controlled). Those states that retained free-markets were given large amounts of aid by the USA in order to help rebuild their state of economy (see Marshall Plan).
Many Western European governments moved to link their economies, laying the foundation for what would become the European Union. This meant a huge increase in shared infrastructure and cross-border trade. Whilst these Western European states rapidly improved their economies, by the 1980s, the economy of the COMECON was struggling, mainly due to the massive cost of the Cold War. The GDP and living standard of Eastern European states were also behind those of their Western neighbours. Even free-market Greece, situated in South-Eastern Europe, struggled due to geographical isolation from Western Europe.
The European Community grew from 6 original members following World War II, to 12 in this period. The emphasis placed upon resurrecting West Germany's economy led to it overtaking the UK as Europe's largest economy.

15:07, 26 May 2007 (UTC)

Stock exchanges

There are many stock exchanges within Europe.

★ Pan-European:

★
★ Euronext

★
★ OMX

★ Austria:

★
★ Wiener Börse

★ Belgium:

★
★ Euronext Brussels

★ Bosnia and Herzegovina

★
★ Sarajevo Stock Exchange

★
★ Banja Luka Stock Exchange

★ Bulgaria:

★
★ Bulgarian Stock Exchange

★ Croatia:

★
★ Zagreb Stock Exchange

★
★ Varaždin Stock Exchange

★ Cyprus:

★
★ Cyprus Stock Exchange (CSE)

★ Czech Republic:

★
★ Prague Stock Exchange (PSE)

★ Denmark:

★
★ Copenhagen Stock Exchange (KFX) (part of OMX)

★ Estonia:

★
★ Tallinn Stock Exchange (part of OMX)

★ Faroe Islands:

★
★ Faroese Securities Market, in cooperation with Iceland Stock Exchange

★ Finland:

★
★ Helsinki Stock Exchange (part of OMX)

★ France:

★
★ Euronext Paris ("La Bourse de Paris") (CAC40)

★ Georgia

★
★ Georgian Stock Exchange (GSE)

★ Germany:

★
★ Frankfurt Stock Exchange (part of Deutsche Börse) (DAX)

★ Greece:

★
★ Athens Stock Exchange (General)

★ Hungary:

★
★ Budapest Stock Exchange (BSE)

★ Iceland:

★
★ Iceland Stock Exchange (Kauphöll Íslands)

★ Ireland:

★
★ Irish Stock Exchange (ISEQ)

★ Italy:

★
★ Borsa Italiana

★ Latvia:

★
★ Riga Stock Exchange (part of OMX)

★ Lithuania:

★
★ Vilnius Stock Exchange (part of OMX)

★ Luxembourg:

★
★ Luxembourg Stock Exchange

★ Macedonia:

★
★ Macedonia Stock Exchange

★ Malta:

★
★ Malta Stock Exchange

★ Montenegro

★
★ Montenegro Stock Exchange

★ Netherlands:

★
★ Euronext Amsterdam

★ Norway:

★
★ Oslo Stock Exchange

★ Portugal:

★
★ Euronext Lisbon

★ Poland:

★
★ Warsaw Stock Exchange (WSE)

★ Romania:

★
★ Bucharest Stock Exchange (BVB - Bursa de Valori Bucureşti)

★
★ Rasdaq

★ Russia:

★
★ Moscow Interbank Currency Exchange (MICEX)

★
★ RTS Stock Exchange

★ Serbia:

★
★ Belgrade Stock Exchange (BELEX)

★ Slovakia:

★
★ Bratislava Stock Exchange (BSSE)

★ Slovenia:

★
★ Ljubljana Stock Exchange (LJSE)

★ Spain:

★
★ Madrid Stock Exchange

★ Sweden:

★
★ Nordic Growth Market

★
★ Stockholm Stock Exchange (part of OMX)

★ Switzerland:

★
★ SWX Swiss Exchange

★ Turkey Turkish Republic

★
★ Istanbul Stock Exchange (ISE)

★ Ukraine:

★
★ PFTS Ukraine Stock Exchange

★
★ Ukrainian Stock Exchange

★ United Kingdom:

★
★ Alternative Investment Market (AIM)

★
★ London Stock Exchange (LSE) (FTSE)

Economic sectors

Agriculture and fishing

Europe's agricultural sector is in general highly developed, especially in Western Europe. The process of making Eastern Europe's agriculture more Western is well underway and is helped by the accession of Eastern European states to the EU. The agricultural sector in Europe is helped by the Common Agricultural Policy (CAP), which provides farmers with a minimal price for their products and subsidizes their exports, which increases competitiveness for their products. This policy is highly controversial as it hampers free trade worldwide (protectionism sparks protectionism from other countries and trade blocs: the concept of trade wars) and is violating the concept of ''fair trade''. This means because of the protectionist nature of the CAP, agricultural products from developing countries are rendered incompetitive in both Europe (an important export market for developing countries) and on their
home markets (as European agricultural products are dumped on developing countries' markets with help from European agricultural subsidies). This controversy surrounds every system of agricultural subsidies (the United States' policy of subsidizing farmers is also controversial). The CAP is also controversial because 40% of the EU's budget is spent on it, and because of the overproduction caused by it.
The Common Fisheries Policy is surrounded by an extensive system of rules (mainly consisting of quotas) to protect the environment from overfishing. Despite these rules, the cod is becoming increasingly rare in the North Sea. Strict fishing rules are the main reason for Norway and Iceland to stay out of the European Union (and out of the Common Fisheries Policy). Price guarantees and subsidizations of fishermen are implemented in the same way as agricultural subsidies are.

Manufacturing

Europe has a thriving manufacturing sector, with a large part of the world's industrial production taking place in Europe. Most of the continent's industries are concentrated in Western Europe (mainly in the zone that comprises England, the Benelux, western Germany, northeastern France, Switzerland, and northern Italy). However, because of the higher wage level and hence production costs, Western Europe is suffering from deindustrialization and offshoring in the traditional (labour intensive) manufacturing sectors. This means that manufacturing has become less important in Western Europe and that jobs are moved to cheaper regions (mainly China and Eastern Europe).
Eastern Europe has been industrialized since the early to mid 20th century but suffered from contraction in the 1990s when the inefficient heavy industry based manufacturing sector crippled after the collapse of communism and the introduction of the market economy.
In the 21st century the manufacturing sector in Eastern Europe picked up because of the accession of Eastern European states to the EU and resulting accession to the European Common Market. This caused Western European firms to move jobs from their manufacturing sector to Eastern Europe (see above), which sparked Eastern European industrial growth and employment.
Some of the world's largest manufacturers are European, such as BP, Royal Dutch Shell, DaimlerChrysler, Maersk, and Volkswagen.

Investing and banking

Europe has a well developed financial sector. Many European cities are financial centres with the City of London being the largest. The European financial sector is helped by the introduction of the euro as common currency. This has made it easier for European households and firms to invest in companies and deposit money on banks in other European countries. Exchange rate fluctuations are now non-existent in the Eurozone. In Eastern Europe, the financial sector is somewhat less developed (mostly because of the communist legacy), but is rapidly developing towards Western European standards. The financial sector in Eastern Europe is helped by economic growth in the region and the commitment of Eastern European governments to achieve these high standards.
European banks are amongst the largest and most profitable in the world (Credit Agricole, HSBC, Royal Bank of Scotland, HBOS, BNP Paribas, Unicredit, Banco Santander Central Hispano).

Global trade relations

The bulk of the EU's external trade is done with the United States of America, China,^[1] India, Russia and non-member European states.
EU members are represented by a single official at the World Trade Organization.
The EU is involved in a few minor trade disputes. It had a long running dispute with the USA of allegedly unfair subsidies the US government gives to several companies, such as Boeing. There is also a dispute with China over textile exports, and the EU has a long running ban prohibiting arms trade with the Chinese.

Economy by country

'see also:' Economy of England - Economy of the European Union - Economy of Northern Ireland - Economy of Kosovo - Economy of Scotland - Economy of Wales

References

1. As regards the EU-China trade relations, see Paolo Farah (2006) Five Years of China’s WTO Membership. EU and US Perspectives on China’s Compliance with Transparency Commitments and the Transitional Review Mechanism, Legal Issues of Economic Integration, Kluwer Law International, Volume 33, Number 3, pp. 263-304.

See also

★ Europe

★ History of Europe

★ European Union

★ Euro

★ European Free Trade Association

★ European Economic Area

★ European Free Trade Area (EU, EFTA, CEFTA)

★ Commonwealth of Independent States

★ Regions of Europe

★ List of European countries by GDP