Czech Republic overtakes Spain in key economic indicator

The Czech Republic is climbing inthe list in GDP per capita in purchasing power parity, according to the OECD

The Czech Republic is catching up with the Western Europe in GDP per capita calculated by purchasing power parity, a key indicator of economic performance. Last year, the country overtook Spain for the first time according to data from the Organization for Economic Cooperation and Development (OECD).

Czech GDP per capita reached $39,741 in purchasing power parity, while Spain’s was $39,711. This means that Czechs buy more domestically than Spaniards can. The Czech Republic, though, ranks 16th in Europe and is still behind the EU average of $43,561 and the OECD average of $45,760.

Czech Fund analyst Lukáš Kovanda told news server Aktualne.cz that the Czech Republic has been catching up with economically more advanced European countries. “Countries of the southern wing of the euro area, including Spain, were particularly hard hit by the debt crisis of the first half of the decade. Central and Eastern European countries have not been hit so hard. This allows them now to compare with the southern part of the euro area more quickly than with other parts of the euro area,” he said.

Also read:  Half the schools in the Czech Republic will take part in Wednesday's strike, but not all will close

Although GDP per capita is often used as a broad measure of average living standards, high levels of GDP per capita do not necessarily mean high levels of household disposable income, a key measure of average material well-being of people. Not all income generated by production (GDP) necessarily remains in the country; some of it may be appropriated by non-residents such as foreign-owned firms sending profits to their parent companies. Some parts may be retained by corporations and government and not accrue to households, the OECD points out

Kovanda said that if factors such as these were taken into account, then the Czech Republic would likely still be behind Spain.

The leader in GDP per capita by purchasing power parity according to OECD was Luxembourg at $113,137, followed by Ireland at $83,081 and Switzerland at $68,079 and Norway at $65,515. The Unites States was the first country outside of Europe to make the list, at $62,853

Also read:  One in six Czech teens play video games at least four hours a day

For the Czech Republic to ovetake the EU average and catch up with some of the leaders, the country would need a long-term concept for economic development, something it now lacks, according to Kovanda.

GDP per capita by purchasing power parity in 2018
1. Luxembourg: $113,137
2. Ireland: $83,081
3. Switzerland: 68,079
4. Norway: $65,515
5. US: $ 62,853
6. Iceland: $57,453
7. Netherlands: $56,326
8. Austria: $55 513
9. Denmark: $55 138
10. Australia: $54 144
11. Germany: $53,749
12. Sweden: $53 249
13. Belgium: $50,442
14. Canada: $48 107
15. Finland: $47 946
16. Eurozone: $46 145
17. OECD: $45,760
18. United Kingdom: $45,505
19. France: $45.149
20. EU: $43,561
21. Japan: $42 823
22. Malta: $42,710
23. Italy: $41,837
24. New Zealand: $40,713
25. South Korea: $40,096
26. Israel: $39,932
27. Czech Republic: $39,741
28. Spain: $39,711

Leave a Reply

Related posts

Sign up for our Newsletter

Enter your email to receive a weekly news update from Expats.cz directly to your inbox! We will never share your email or send you spam.

Close Menu