Austria benefited the most by the introduction of the Euro, according to an investigation.
The German department of internationally operating consulting group McKinsey examined the economic performance of the 17 members of the Eurozone to determine which nation prospered the most. Twelve European Union (EU) states including Austria are the Eurozone’s founding members as they introduced the currency in 2002.
McKinsey Germany said yesterday (Tues) that no other gross domestic product (GDP) grew stronger than the one of Austria from 2002 to 2010 thanks to the effects of the Euro. The company said lower trade costs and other declines of charges helped the small country to a 7.8 per cent GDP increase of 22 billion Euros. Finland also strongly benefited. The Scandinavian country achieved a GDP jump of 6.7 per cent or 12 billion Euros between 2002 and 2010. Germany (plus 6.4 per cent) and the Netherlands (plus 6.2 per cent) take third and fourth place in the study ahead of Italy (plus 2.7 per cent) and Portugal (plus 2.1 per cent).
McKinsey Germany explained that economically challenged countries like Spain (plus 0.7 per cent) and Greece (plus 0.1 per cent) also benefited from the Euro – but less strongly than other nations because of a lack of reforms. The agency criticised that lawmakers in the southern EU members failed to carry out structural changes that would have helped their economies to develop.
Austria’s government coalition of Social Democrats (SPÖ) and the People’s Party (ÖVP) abstained from holding any kind of celebration marking the 10th anniversary of the Euro’s introduction due to the tense economic climate in Europe. Research shows that many people think the Euro lacked any kind of protective function in the various crises since 2008.
The Austrian National Bank (OeNB) – which organised an exhibition on the creation and introduction of the Euro – recently stressed that the value of exported services and goods rose by 20 per cent to 60 per cent of the Austrian GDP since 2002. It also underlined that 55 per cent of exports went to other members of the Eurozone. The OeNB added that 500,000 jobs were created and secured by the Euro. It made aware of the “high importance” the Euro had for the domestic economy.
The Austrian Society for European Policies found that the share of Austrians putting trust in the Euro dwindled from 61 per cent in March 2010 to 47 per cent last June. EU-wide investigations identify Austrians as one of the biggest Eurosceptics. Residents of Belgium, Luxembourg and Ireland appreciate the currency the most while people living in Great Britain – which is not a member of the Eurozone – dislike the Euro the most. Polls also show that almost eight in 10 Austrians fear that the Eurozone debt crisis will not be over anytime soon despite the EU’s recent decision to cancel half of Greece’s national debts.
Fritz Breuss of the Institute for Economic Research (WIFO) told profil that “especially Austria as a small, export-orientated economy, benefited enormously from the Euro.” He said Austria’s GDP grew stronger year after year than the average GDP of Eurozone members. “The Euro is a success story, despite the debt troubles of some Eurozone member states,” OeNB Governor Ewald Nowotny said.