Tuesday, December 12, 2023

Closer to the Greek periphery than to Central Europe

Canaries walk backwards like crabs. The islands, which managed to equalize the average income of the entire state at the end of the 20th century with the help of European funds, have achieved this For more than two decades, people have moved away from the country’s per capita wealth and thus from the European Union (EU). A process of relative impoverishment that has seen the archipelago return to the path of growth that put the islanders on a par with the rest of the Spanish while wasting a good portion of the EU’s money.. In terms of GDP, wealth or income per capita, the Autonomous Community is not only moving further and further away from the national and community average, but is actually moving closer and closer to the Greek periphery. from the Turkish region Anatolia Central or for example from the Hungarian provinces Transdanubia Meridional. A reality that collides directly with the government’s inability to make the most of ordinary European resources, of which around 50%, or half, have been wasted. These include the European Maritime and Fisheries Fund, the European Agricultural Fund for Rural Development, the Cohesion Fund, the European Social Fund and the European Regional Development Fund, the ERDF.

In the 1970s and 1980s, the gross domestic product (GDP) per inhabitant of the Canary Islands was about 65% of the Spanish average. On the whole, one could say that for every hundred euros that the average Spaniard had in his pocket, the Canarian barely had 65. The islands were much poorer – or much less rich – than the state as a whole. It is true that GDP or per capita income is not an infallible indicator, but it is no less true that it is a reference that reflects the productivity and economic development of an area: The higher the GDP per capita of a country or region, the higher the quality of life of its citizens.. Suffice it to point out Luxembourg It is the Member State with the highest per capita income in the entire Union and at the same time one of the countries with the highest Human Development Index (HDI) in the world. The fact is that the archipelago experienced remarkable growth starting in 1986 with the entry of Spain into the community club. Growth fueled by the manna of European funds, particularly large since the region was among the least developed in the EU, that is, regions whose GDP per capita does not reach 75% of the average. That was a turning point.

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The islands that were eliminated from the group of least developed regions are back in the queue

In 1999, the income of the Canary Islands was already more than 99% of the national average, which meant that convergence with the rest of the country was practically achieved. The Canarian, who in the 1970s and early 1980s had just 65 euros in his pocket – compared to a hundred euros for the average Spaniard – had grown to over 99 euros. The gap had closed. However, a second turning point is then recorded, only this time the wealth curve slopes downwards. The process of convergence that the archipelago had experienced since Spain’s accession to the EU thus turned into a decadent process of divergence..

In 2000, the islands’ GDP per capita took a first step backwards and was below 98% of the national average. In 2002, already in the 21st century, it was reduced to below 97% and in 2005 it did not even reach 92%. In 2012, amid the severe recession that began in 2008 and only ended in 2014, per capita income was barely 85% of the Spanish average. And in 2019, before the twin crises of Covid and inflation, it remained at 80.4%. The Canary Islands have been experiencing this process of relative impoverishment for more than twenty years. Relatively, because the economy grew during these years, but not as much as the population, which ultimately slowed down GDP per capita. It is not for nothing that the formula for income or wealth per capita is as precise as it is simple: it is the quotient of GDP – the value of all goods and services produced by an economy in a certain period of time – by the number of inhabitants. . When the economy grows less than the population, GDP per capita suffers. Dividing a pie – GDP – among five people is not the same as dividing it among twenty, because the slices – GDP per capita – will be smaller.. In short, the island’s institutions and productive fabric were unable to increase the low productivity that characterizes the archipelago.

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As if that wasn’t enough, the pandemic broke out in 2020, causing per capita wealth on the islands to drop to 72.9% of the national average. In 2021 it has improved a little, up to 74.5% – this is the latest official data available – and last year it was certainly the same, although still below 2019 levels and with no change in trend this long Process impoverishment.

Wasted money

During this process The Canary Islands have wasted around 50% of Community funds. This is one of the most important conclusions of a consultation investigation Group 5 published in April. The work sparked some controversy as the previous team at the helm of the Treasury significantly increased the percentage of work carried out in the last 2014-2020 budget period. Be that as it may, the current head of the Ministry of Finance, Matilde Asian, accepted this Wednesday the calculation of the analysts of Corporación 5 – who do not limit themselves to the last budget period but present a historical review – for a few days. Actually, According to the Government of the Canary Islands, the percentage has improved to 77% of the total allocations for the period 2014-2020. In any case, and beyond precise percentages, there is complete agreement that the islands have not been able to export, that is, spend effectively, much of the money that Europe has been pouring into them for years. Money whose aim is to bring socio-economic conditions closer to Community standards, or what is the same thing: to bring the region’s per capita wealth ever closer to the EU average. Something that doesn’t seem close to being achieved.

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The relative impoverishment of the region goes hand in hand with the waste of EU funds

At the end of 2021, Spain’s GDP per capita was – in purchasing power parity terms – 83% of the EU average; that of the Canary Islands, at only 62%. Even without definitive data, Spanish per capita income in 2022 would be around 85% of the average; the canary, 65%. The archipelago that once managed to leave the group of least developed regions of the EU Region in transition – those with a GDP per capita between 75 and 100 percent of the European average–, Head back down the path and return to the galley. The islanders are therefore closer to the pole Subcarpathian Voivodeship with a per capita GDP of 53% of the municipal average, from the Greek periphery Macedonia Occident (53%) or from the easternmost and poorest region of SlovakiaEastern Slovakia51% – that of those who thrive Leipzig (99%), Liguria (101%) or the Italian region straight (109).

Nation World News Desk
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