Bosnia and Albania are the countries with the lowest GDP per capita, expressed in purchasing power standards (PPS), according to the latest data released by the EU statistics office Eurostat said on December 13.
Bosnia is at the bottom as its GDP per capita, expressed in PPS, stood at just 28% of the EU-28 average in 2015, the same as in the previous year. The country’s economy is still suffering from the consequences of the 1992-1995 Bosnian war, which hit all big companies in the country. Also, the ongoing political and economic uncertainty is pulling away foreign investors, which leads to very high unemployment and low purchasing power.
Albania’s GDP per capita, expressed in PPS, was also very low last year – 30% of the EU-28 average, unchanged from 2014. The country is on the bottom of the table as a result of the low purchasing power in the country, one of the poorest in Europe with high jobless rate, and due to the inadequate GDP growth.
However, according to Albanian Statistics Office data, GDP per capita was higher in 2015, reaching €3,554 from €3,443 in 2014. It is likely to increase further as GDP is expected to expand solidly to 3.8% in 2017 and consumption to recover as labor market continues to improve. Poverty rate is also expected to reduce further.
Across the region, EU member Slovenia had the highest GDP per capita expressed in PPS last year – 83% of the EU28 average, followed by the other EU members – Croatia (59%), Romania (55%) and Bulgaria (47%).
On the other hand, all Western Balkan countries had considerably lower GDP per capita last year. Montenegro had the highest GDP per capita (42%), followed by Serbia (36%) and Macedonia (36%).
In regional comparison, the country lags well behind its neighbours – Croatia (GDP per capita at 58% of the EU28 average), Montenegro (42%) and Serbia (36%).
In terms of the concept of Actual Individual Consumption (AIC) per capita, Bosnia and Albania were at 37% of the EU average in 2015 each.
AIC is considered a more accurate measure to compare households’ welfare, as it consists of goods and services purchased directly by households, as well as those provided by non-profit institutions and the government, such as healthcare and education.
The Purchasing Power Standard (PPS) eliminates price level differences between countries and thus one PPS buys the same volume of goods and services in all countries.