Despite being the 2nd smallest continent in the world, Europe makes up for its diminutive size by the wealth of its nation states. With abundant natural resources and strong trade relationships with the rest of the world, the developed economies of Europe have weathered the storm of the 2007- 2010 financial crisis to show year- on- year growth in the proceeding period.
To see which countries have the most riches at their disposal, let’s look at the rundown of Europe’s top 20 richest countries by GDP per capita.
20. Slovenia - $36,566 GDP per capita
The small but mighty sovereign state of Slovenia creeps onto our list at 20th position. Bordered by 4 countries and lapped by the Adriatic Sea, Slovenia is the 2nd wealthiest Slavic country per capita (the Czech Republic just pips it the post at number 1 spot).
Its export-oriented economy took a major hit during the 2009 Eurozone crises, shrinking by 8% - one of the biggest contractions across Europe. An austerity policy, combined with increased privatization of state industries, resulted in a complete recovery in 2014.
Its economy has been further bolstered in recent years thanks to a robust growth in the tourism and construction sectors.
19. Czech Republic - $37,546 GDP per capita
The Czech Republic (or Czechia, as its known to its inhabitants) is a landlocked country situated smack bang in the middle of Europe. Its capital and largest city, Prague, boasts a population of 1.3 million, while other major cities include Brno, Ostrava and the beer- capital of Europe, Pilsen.
Its developed, export-orientated economy is founded largely on service, manufacturing and innovation. It’s largest companies by revenue are car manufacturer Skoda Auto, utility company CEZ Group, international conglomerate Agrofert, energy company Energetický a průmyslový holding, a.s., and chemical company, Unipetrol.
18. Cyprus - $38,980 GDP per capita
After joining the European Union in 2004, Cyprus enjoyed a brief period of prosperity until the Eurozone crisis hit its shores in 2012. Cyprus’s economy took such a hit that in 2012, its credit rating was relegated to junk status by credit rating agency, Finch.
Thankfully, a steady stream of tourists, along with an influx of foreign investors keen to take advantage of the country’s lenient immigration policies, has done much to aid recovery in the proceeding years.
17. Italy - $39,499 GDP per capita
With a population of 61 million and $39,499 GDP per capita, Italy occupies the position of 4th most populous EU member and 17th richest European country overall. Italy’s buoyant economy is largely a result of its sizable agricultural sector and competitively placed automotive, manufacturing and fashion industries.
It can also thank its wealth on its position as fifth most visited country in the world: with over 50 million tourists flocking to the country on an annual basis, tourism contributes a healthy 13% to GDP.
16. Spain - $40,289 GDP per capita
Spain enjoys the position of Southern Europe’s largest country, and the fourth largest across Europe as a whole.
Despite an unemployment rate that ranks among the highest in the Eurozone, an education system that’s one of the poorest across the developed world and a large, informal economy, the Spanish economy has seen substantial growth since the ‘90’s, with many companies achieving multinational status (largely as a result of significant expansion in Latin America and Asia) and a tourist industry that now ranks as one of the biggest in the world: in 2017, Spain polled as the 2nd most visited country in the world, with the proceeds contributing a generous 11.7% to GDP.
15. Malta - $44,670 GDP per capita
Malta manages to combine being the tenth smallest country in the world with its fifth most populated. With a Mediterranean climate and legions of sites of historical and architectural significance (including 3 UNESCO World Heritage Sites), it’s little wonder its economy relies heavily on tourism.
In terms of GDP, tourism contributes a healthy 27.1%, with the rest coming from foreign trade, electronic and textile manufacturing, financial services and a booming property market.
14. France - $45,473 GDP per capita
The sovereign state of France is a leading member state of the European Union and the Eurozone, as well as a member of the Group of 7, NATO, OECD and WTO. With a mixed economy that includes both state and private enterprises, French companies such as AXA (the largest insurance company in the word), BNP Paribas, Crédit Agricole and the Société Générale hold leading positions in the world’s financial and insurance industries.
Its agricultural industry, meanwhile, contributes 2% percent to GDP, and positions France as the second largest exporter of agricultural products in the world. Other economic dependencies include tourism (France is ranked as the most visited country in the world, with over 86 million tourists annually), transportation, science and technology.
13. United Kingdom - $45,565 GDP per capita
With a population of approximately 66 million, the United Kingdom is the 22nd most populous country in the world. Its partially regulated economy is driven largely by the service sector, which contributes around 80% of GDP.
Other key economic dependencies include manufacturing, an automotive industry that generates around £42 billion of exports annually, a subsided agriculture, an aerospace industry ranked as one of the largest in the world, and a booming tourist trade.
While the UK currently enjoys a relatively high ranking among Europe’s wealthiest countries, how it will fare after its planned withdrawal from the European Union in 2019 is still in question.
12. Finland - $46,342 GDP per capita
The Northern European country of Finland boasts a small but comparatively wealthy population of 5.52 million. Its economy is highly developed and based largely around the service sector, which contributes around 70% of GDP.
Industry, meanwhile, makes up 27.2% of GDP (with electronics, machinery, automobiles and metals making up its key productions), while agriculture contributes 2.6%. As would be expected of such a densely forested country, timber represents one of the country’s largest exports, making Finland one of the world’s biggest wood producers.
11. Belgium - $48,258 GDP per capita
As one of the 6 founding countries of the European Union, Belgium enjoys an advanced, high income economy. Its combination of a highly skilled, multilingual work force and its position at the epicenter of Europe’s most industrialized region contributes to its ranking as one of the world’s largest trading nations, with machinery and equipment, chemicals, diamonds, metals and food products constituting its top exports.
The service sector accounts for 74.9% of GDP, while agriculture accounts for a comparatively minuscule 1%. The remainder comes from industry, of which steel, textiles, chemicals, pharmaceuticals and electronics represent the highest direct contributors.
10. Denmark - $51,643 GDP per capit
Denmark enjoys a small, open market economy, with a high dependence on foreign trade. As a result of its liberal trade policy, Denmark’s exports make up just under 50% of GDP. As a member of the EU, it has the option to join the EMU, but has thus far opted to maintain an independent currency.
Denmark follows the traditional Nordic social model, with a high tax rate associated with a high level of government funded services. High taxation contributes significantly to the country’s overall income; in 2017, for example, the total taxes paid amounted to 50.8% of GDP.
9. Austria - $51,936 GDP per capita
Historically, most of Austria’s trade has been with Germany. However, since joining the EU, the country has developed its trading links with other member states, and simultaneously drawn a growing number of foreign investors attracted to its access to the single European market and its close ties to other growing EU economies.
In 2018, GDP saw growth on previous years and now sits at $51,936, By sector, this breaks down to 1.3% from agriculture, 28.4 % from industry and 70.3% from service.
8. Germany - $52,801 GDP per capita
The large, highly developed social market economy of Germany has shown significant growth in recent years, and with the 2nd biggest export trade in the world, it seems in no danger of slowing down anytime soon.
Its service sector is by far the largest contributor to GDP (around 70%) while industry contributes 29.1% and agriculture, 0.9%. In terms of trade, vehicles, pharmaceuticals, chemicals, rubber, plastics and food products constitute the bulk of exports, while the country’s wealth of natural resources (timber, lignite, potash and salt as the most significant) are also in hot demand.
7. Sweden - $53,077 GDP per capita
The highly developed export-oriented economy of Sweden has evolved in recent years from an agricultural economy into one with major dependencies on engineering, mining, steep and pulp.
Like many other Northern European countries, Sweden follows the Nordic model of high-income taxes and correspondingly high levels of government funded services. In terms of revenue, it has the 4th highest total tax revenue as percentage of GDP in Europe, and 2nd in the Baltic's (Denmark beats it by a 2% margin). By sector, 65.4% of GDP comes from services, 33% from industry, and 1.6% from agriculture.
6. Iceland - $54,121 GDP per capita
Iceland’s small economy was heavily hit by the 2007-2010 financial crisis, to the point the country was forced to request emergency funding from the IMF in 2008. Subsequent years, however, have seen it enjoy a compete recovery.
Recent growth can be attributed to a booming tourism trade, which now accounts for more than 10% of Iceland’s GDP. Similar growth has been seen in the software and biotech industries. Fishing continues to be a key contributor to the country’s finances, providing 12% of GDP and 40% of export earnings.
5. Netherlands- $56,435 GDP per capita
Since 1959, the sale of natural gas has been one of the Netherlands’ biggest money-spinners, and a major contributor to its large, open economy. Conversely, it’s also been a key factor in the decline of the Dutch manufacturing sector, leading to the economic theory of Dutch disease.
The prosperity of the country is heavily dependent on foreign trade, with chemicals, machinery, equipment and food products serving as primary export commodities. By sector, 70.2% of GDP comes from services, 17.9% from industry, and 1.6% from agriculture.
4. Switzerland - $63,380 GDP per capita
As one of the world’s biggest free market economies, Switzerland has seen healthy growth in the last few years. Most of this is down to a highly developed service sector, which includes one of the world’s most significant banking industries and a very robust tourism trade.
Overall, services make up a healthy 73.7% of GDP. Industry makes up most of the remaining contribution (thanks largely to a pharmaceutical industry which ranks as one of the most competitive in the world), while agriculture makes up less than 1%.
3. Norway - $74,065 GDP per capita
Norway boasts one of the highest standards of living of any European country, and a similarly prosperous economy. Its developed, mixed economic structure is heavily dependent on natural resources, and it remains one of the world’s leading petroleum exporters, despite oil production showing a 50% decline since 2000.
Compared to other European countries, Norway’s reliance on industry is relatively high: 34.7% of GDP comes from industry, while 63.5% comes from services and 1.6% from agriculture. Rich in natural resources such as oil, gas, timber and fish, Norway has a strong export economy and is ranked as the world’s largest exporter of seafood after China.
2. Ireland - $79,925 GDP per capita
Despite a stumble in the final quarter of 2018 (triggered by a slowdown in domestic demands and a contraction in construction related investments), Ireland’s small, modern economy is still one of the strongest in Europe.
This owes to a strong export sector, low inflation and healthy employment growth. Lenient tax residency requirements have historically made Ireland a target for international firms looking to benefit from a low tax rate. While recent years have seen the introduction of more stringent tax laws, the economy is still set to grow in 2019, despite the currently uncertain impact of Brexit.
1. Luxembourg- $110,870 GDP per capita
The small, robust economy of landlocked Luxembourg benefits from year on year growth, low inflation and an equally low unemployment rate. Since 2002, the country’s government has rolled out a series of polices designed to encourage economic diversity and increase foreign investment in the key fields of logistics, ICT, medical research, financial service technologies and space technologies.
In terms of its wealth, Luxembourg’s financial industry is key, accounting for more than 35% of GDP. This owes to the growth in the investment fund sector since the launch of cross-border funds in the 1990’s, which has pushed Luxembourg to 2nd position in the ranking of the world’s largest investment fund asset domiciles.
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Written by Garrett Parker
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