Europeans have around 0.3 percent more nominal purchasing power per person in 2016 compared to last year. The available net income of the population varies substantially among the 42 countries considered by the GfK study. The highest average purchasing power can be found in Liechtenstein, Switzerland and Luxembourg, while the lowest is in Belarus, Moldova and the Ukraine. Ukrainians have only one eightieth the average purchasing power of Liechtenstein inhabitants. These are some of the findings of the study “GfK Purchasing Power Europe 2016”.

According to the GfK study, a total of approximately €9.18 trillion is available to European consumers in 2016 for spending and saving. This corresponds to an average per-capita purchasing power of €13,672 for the 42 countries evaluated in the study, which is a nominal increase of approximately 0.3 percent. The low growth in Europe’s average per-capita purchasing power is due to exchange rate effects and stagnating growth rates in some of the larger countries, among other factors. Nonetheless, many countries have growth rates above 5 percent, including Iceland, Bulgaria, Romania, Estonia, the Czech Republic, Bosnia-Herzegovina, Croatia, Malta, Slovakia, Luxembourg and Latvia.

Top ten purchasing power countries in Europe

source: © GfK Purchasing Power Europe 2016                        
*index per inhab.: European average = 100
exchange rate for non-euro countries: prognosis of European Commission for 2016 from May 3, 2016

There is still a large gap between net incomes in Europe: Inhabitants of Liechtenstein, the country with the highest purchasing power, have almost eighty times as much purchasing power per person as inhabitants of the Ukraine, which has the lowest purchasing power in Europe. The four countries with the greatest number of inhabitants – Germany, Great Britain, France and Italy – comprise approximately 40 percent of Europe’s population and almost 60 percent of the continent’s purchasing power.
Even within the top-ten ranked countries, Liechtenstein and Switzerland significantly outpace the others with purchasing power values that are 3 to 4.6 times (respectively) the European average. Lagging substantially behind is third-ranked Luxembourg, with 2.2 times the European average. All other countries in the top ten have at least 1.5 times the average European per-capita purchasing power.

Some reshuffling has occurred among the top-ten countries compared to last year, primarily due to exchange rate effects. Luxembourg overtakes Norway to seize third place, while Iceland climbs three slots to fifth place and Great Britain falls four positions to tenth place.

Comparison of selected countries and regions

A comparison of similarly ranked countries in close geographic proximity offers insights into the distribution of wealth. Below are some results from the GfK purchasing power studies for France, the Netherlands, Italy, Spain, Poland and Hungary. The findings reveal some stark contrasts both between and within these countries with respect to income and the associated spending potential of the population for retail, services, accommodation, insurance, mobility, etc.

source: © GfK Purchasing Power Europe 2016                        
*index per inhab.: European average = 100
exchange rate of non-euro countries: prognosis of the European Commission for 2016 from May 3, 2016

Relatively balanced picture for the Netherlands
The Netherlands have an average per-capita purchasing power of €17,901, which puts the country in 15th place and 31 percent above the European average.

Representing the country’s average is the province of Zeeland, where consumers have a per-capita purchasing power of €17,845. Seven of the nation’s twelve provinces are also in this range. These provinces deviate only 6 percent from the average purchasing power in the Netherlands. As such, the regional distribution of purchasing power in this country is very homogeneous.

Purchasing power in the Dutch provinces

 GfK Purchasing Power Netherlands 2016                             
*index: value per inhabitant / average = 100

The surroundings of Amsterdam in the border areas of the provinces of Noord-Holland, Zuid-Holland and Utrecht have the country’s highest per-capita purchasing power. With €19,346 per capita, Utrecht has the highest purchasing power among the twelve provinces. As such, inhabitants of Utrecht have approximately 8 percent more purchasing power than the national average and around 40 percent more than the European average. By contrast, the country’s northeastern provinces of Groningen, Drenthe and Friesland have a purchasing power that is 10 to 15 percent below the average. Groningen is in last place with a per-capita purchasing power of €15,208, which is around 15 percent below the national average. Even so, inhabitants of Groningen have around €1,500 more per person than the European average.

France after the administrative reform
France has an average per-capita purchasing power of €19,254, which puts it almost 41 percent above the European average and in 12th place, closely followed by Belgium (€18,983 per capita, in 13th place) and the Netherlands (€17,901 per capita, in 15th).

An administrative reform in France led to a restructuring of the regional levels on January 1, 2016, reducing the previous 22 regions to just 13. The new regions have on average 4.9 million inhabitants instead of the 2.9 million prior to the reform, a fact that impacts the per-capita purchasing power values.

With a per-capita purchasing power of €22,799, the region of Ile-de-France remains far ahead of the rest of the pack. As such, inhabitants of France’s capital region have on average 1.2 times more purchasing power than the national average and just under 1.7 times the European average. The only other region with an above-average per-capita purchasing power is Auvergne-Rhone-Alpes: The former Auvergne region is profiting from its fusion with the Rhone-Alpes region, which has higher purchasing power and a higher number of inhabitants.

France’s top ten regions

GfK Purchasing Power France 2016     
*index: value per inhab. / average = 100  
**names as of 01.01.2016

In previous years, the country’s Northern region of Nord-Pas-de-Calais was in last place in the regional ranking. The fusion of this region with the Picardie region did little to change this: The per-capita purchasing power available to inhabitants of the new region Nord-Pas-de-Calais-Picardie is 25 percent below the average in the neighboring capital region.

Spain sole country to represent the European average
Spain has a 2016 per-capita purchasing power of €13,840, which puts it 1.2 percent above the European average and in 17th place. Spain is relatively alone in the middle of the European purchasing power ranking. Adjacent in the ranking are Italy (16th place) with €16,709 per person and 22 percent above the European average, and Malta (18th), which is well behind at €11,366 per person.

Spain’s wealthiest province is Gipuzka, which has a per-capita purchasing power of around €18,483. Inhabitants of Gipuzka thus have around one-third more than the Spanish average and around the same as inhabitants of Ireland. Inhabitants of Cadiz, the least wealthy province, have an average per-capita purchasing power of just €9,333, which is one-third less than the national average. With a per-capita purchasing power of €13,706, inhabitants of Asturias are almost exactly at the average. 

Top ten provinces in Spain

GfK Purchasing Power Spain 2016                                        
*index: value per inhabitant / average = 100

North-South divide in Italy

Italy has an average per-capita purchasing power of €16,706, which is around the average of the EU-28 countries. This equates to 22 percent more than the total European average, putting Italy in 16th place among the 42 countries considered by the study.
With a per-capita purchasing power of €22,722, Milan is in first place among the country’s 112 provinces. Inhabitants of Milan thus have an average of 36 percent more than the national average. Crotone in Southern Italy takes last place with a per-capita purchasing power of €9,996, which is aro