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Growth without welfare, Albania remains the last in Europe for per capita income

Growth without welfare, Albania remains the last in Europe for per capita income

Although the Albanian economy has had a good performance after the pandemic and tourism has reached records, this is not translating into more welfare for the country's citizens. The latest Eurostat data, updated for 2023, put Albania back at the end of Europe for per capita income by 35% of the European average, from 34% which was in 2022. Albania is at the same level as Bosnia, while data on Kosovo are missing.

Economic growth driven mainly by the high flow of construction and real estate sales, or and the high number of tourists does not seem to have improved the well-being of Albanians in the last two years.

Northern Macedonia had revenues of as much as 41% of the EU, with a drop of one percentage point from the previous year. Serbia had this indicator 46%, from 44% last year. The highest level in the region is Montenegro, with 52%, from 50% last year.

Even in other indicators, that of individual per capita consumption (AIC), which measures the purchasing power of service goods, Albania ranks last, with 42% of the European average, from 41% the previous year, ranking last in Europe, 2 percentage points less than Bosnia and Herzegovina that has increased this indicator to 44% (in 2022 we were at the same levels ). The highest level is Montenegro with 65% ( from 63% in 2022 ), followed by Serbia with 54%, with an increase of 1 percentage point and Northern Macedonia by 52%, from 50% in 2022.

According to Eurostat, although GDP per capita is an important and widely used indicator of the level of economic well-being of countries, per capita consumption may be most beneficial for comparing the relative well-being of consumers in different countries.

During 2023, the Albanian economy grew by 3.4%, slowing compared to a 4.86% expansion in 2022. About half of this growth came from construction and real estate, which expanded by 9.7% and 11.3%, respectively%. It seems that this growth that is coming from construction is failing to improve the well-being of Albanians, who continue to remain the poorest of Europe.

In 2023, current individual consumption (Actual Individual Consumption, AIC per capita expressed in purchasing power standards (PPS ) ranged from 70% to 138% of the EU average in 27 EU countries. AIC includes all goods and services used by households, regardless of whether they have been purchased and paid for by households directly, by the government or by non-profit organizations. It can be considered an indicator of the material well-being of families.

In 2023, 10 EU countries recorded AIC per capita above the EU average. The highest levels were recorded in Luxembourg (38% above the EU average ), Austria and the Netherlands ( both 17% ). Meanwhile, 17 EU countries recorded AIC per capita below the EU average, with the lowest levels recorded in Hungary (30% below the EU average ), Bulgaria (27%), Slovakia and Latvia ( both 25% ).

Luxembourg and Ireland mark the highest GDP per capita

Gross Domestic Product (GDP ) per capita, a measure of economic activity, also showed substantial differences between EU members.

GDP per capita above the EU average was recorded in 11 EU countries. It was highest in Luxembourg (139% higher than the EU average ), Ireland (11% ) and the Netherlands (30% ). On the other hand, the lowest per capita GDP was recorded in Bulgaria (36% below the EU average ), Greece (33% ) and Latvia (29% )./ Monitor

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