The New E.U.
Brian Trumbore
President/Editor, StocksandNews.com

I have been traveling in the Far East and commenting extensively on some of the political and financial aspects in my "Week in Review" commentary. For this column, though, I thought I'd review the history that was made last Saturday. [I have to apologize that this was gleaned from various newspapers as it is not possible while traveling to access my own research library back home.]

May Day was special this year with the admittance of 10 nations into the European Union. For starters, the population of the now 25-country bloc rises from 378 million to 455 million. [Germany is the most populous at 82.5 mm, Malta the smallest with around 400,000. And there are now 20 official languages. But I thought we'd examine the GDP per capita and the 2003 GDP rate of both the current and incoming members, along with three "candidate countries" that will be examined in future years and some selected non-members.

Current Members

Austria?$31,545? +0.7% [GDP in '03]
Belgium?29,295? +1.1
Britain?30,398? +2.2
Denmark?39,602? +0.4
Finland?31,261? +1.9
France?28,625? +0.2
Germany?29,318? -0.1
Greece?15,795? +4.7
Ireland?38,205? +1.2
Italy?25,443? +0.3
Luxembourg?58,716? +1.8
Netherlands?31,750? -0.8
Portugal?14,250? -1.3
Spain?20,693? +2.4
Sweden?33,920? +1.6

New Members

Cyprus?$18,011? +2.0%
Czech Republic?8,420? +2.9
Estonia?6,227? +4.7
Hungary?8,216? +2.9
Latvia?4,477? +7.4
Lithuania?5,295? +8.9
Malta?12,693? +0.4
Poland?5,511? +3.7
Slovakia?6,091? +4.2
Slovenia?13,943? +2.3

Candidate Countries

Bulgaria?$6,500? +4.8%
Romania?7,600? +4.9
Turkey?7,300? +7.8

Non-Members

Albania?$4,400? +7.3%
Belarus?8,700? +4.7
Moldova?2,600? +6.5
Russia?9,700? +4.3
Switzerland?32,000? +0.1
Ukraine?4,500? +4.8

Of course you can see that the new members to the E.U. bring stronger growth rates but economies that overall are far smaller, thus creating pressures on the European Union budget. Everyone wants to be the next Ireland, that country having taken advantage of E.U. subsidies and enlightened tax policies to emerge from the backwaters into one of the better stories of the global economy of the past 20 years.

And with good reason, Russia is wary as the E.U. closes in further on its borders with the addition of the Baltic States, though a full 51% of Russia's exports will now go to the expanded club. The E.U., though, needs to worry about nations like Belarus, Moldova and Ukraine, which are now neighbors to E.U. states, making it easier to export their own indigenous problems of crime, poverty and smuggling of all sorts (including human trafficking). The average daily wage in Moldova, for example, is $3.

Finally, in viewing a few miscellaneous indicators for the ten new E.U. members, Slovenia has the most personal computers per 100 people with 30, while Poland, Lithuania and Hungary have the fewest, each with 11. And when it comes to smoking; a full 50% of men in Lithuania and Latvia light up, versus a low of 21% in Slovakia. Ergo, healthcare costs in the first two must be rather high, let alone because of the amount of alcohol that is consumed in these parts. [Not that yours truly doesn't enjoy a beer now and then myself.]

Sources: Eurostat, CIA Sourcebook, International Herald Tribune, The Straits Times

Brian Trumbore