Balanced overall growth is considered a precondition for reasonable equilibrium in living conditions across the entire EU territory. The economic success of a region can be assessed in many ways. A measure that is most often used is Gross Domestic Product (GDP) both in absolute figures and as a rate of change, the latter being helpful to measure economic growth.

On the basis of one of the most used macro economic indicators, the GDP per capita (in PPS), ESPON has developed a European map showing economic concentration and balanced growth.

Concept/method/measurement

The map includes information on the average yearly growth rate of GDP per capita in Purchasing Power Standards (PPS) from 1995-2003, the regional share of total GDP in Euro in 2003 of the 27 EU Member States together with Norway and Switzerland (the ESPON space), the highest differences in GDP per capita in 1999 and the GDP per capita in PPS in % of EU average in 2003.

The Gross Domestic Product (GDP) is calculated by adding up all the economic activities of a national or regional economy. The regional share of total GDP in Euro has only considered the the most developed regions in terms of GDP which together represent 50% of the total GDP of the ESPON space. This regional share varies according to the size of the coloured circles. The GDP per capita in PPS in % of EU average has also been associated to these circles, varying according to their colour. Finally, the highest differences in GDP per capita among nearby NUTS-2 regions are shown by the coloured lines. 

Interpretation

At regional level in 2003, there was a strong concentration in the central area of the European territory, of both regional shares in the total GDP of ESPON space, and above-average GDP per capita values. This area streches from Ireland, Scotland and the Scandinavian countries, through large parts of France and Western Germany, to central Spain in the west and to Austria in the east. A closer look reveals that the highest GDP per capita values are generally in urban agglomerations. Only two regions in the countries that joined in 2004 (Warsaw and the Budapest region), are represented amongst those most developed regions contributing to half of the total GDP of the ESPON space.

When looking at economic growth rates a different territorial picture emerges. Regions in Ireland, Estonia, Latvia and Lithuania have the highest GDP growth rates in PPS, with over 8 % per year between 1995 and 2003 on average. Many regions in Slovakia, Slovenia, Poland, Greece, Hungary, Spain and Romania also achieved growth rates rarely seen in the core of Europe.

Regional disparities still exist, particularly across the former borders between the new and old EU member states. For example, there are significant differences in GDP at the German border with Poland and the Czech Republic, where Austria borders the Czech Republic and Hungary and as well between Greece and the Bulgarian regions. High relative differences of GDP also separate the main economic centres and capital regions from neighbouring areas, for example in Paris, in Luxembourg, and in the Scandinavian capitals. 

Conclusion

Convergence is occurring both at national and at regional level in the European territory. However, this process is still characterised by different strengths and speeds in economic development and considerable differences in national and regional GDP.

Disparities remain important and visible within the ESPON space, especially regarding the continuing economic differences between old and new member states. Nevertheless, the GDP growth rates indicate that lagging regions are catching up, and forging a path to a more balanced development of the European territory.

This convergence process in terms of economic prosperity will expectedly contribute for a greater territorial cohesion in the EU. However, it is also important to keep in mind the current need to reinforce the competitiveness of regions on a European and global scale. These are some of the main challenges that the European cohesion policy has to face.

Further reading: ESPON Atlas