Europe by the Numbers

A Lot to Gain A Lot to Lose

The region of Central, East, and Southeast Europe faces huge economic challenges as it emerges from the twin shocks of the pandemic and energy-driven high inflation.

Richard Grieveson, deputy director at the Vienna Institute for International Economic Studies (wiiw).
Richard Grieveson, deputy director at the Vienna Institute for International Economic Studies (wiiw). Nathan Murrell

The region of Central, East and Southeast Europe (CESEE) has broadly had a good 30 years in terms of economic convergence. In the mid-1990s, following the shocks of the initial transition years, the 11 CESEE countries that are now members of the EU had a per capita GDP in purchasing power parity terms of 45 per cent of the EU level. By 2021, it was 77 per cent (Figure 1). Such has been the success of parts of EU-CEE in particular, that the division between “old” and “new” member states in economic terms is increasingly obsolete. As of 2022, Slovenia, Czechia, Lithuania, and Estonia were all wealthier than Spain, Portugal, and Greece (Figure 2). According to the IMF, in real US dollar terms adjusted for local costs, Slovenia and Czechia have a similar per capita GDP to Japan.