Assessing PIIGS Country Performance against Themselves and the EU

Samuel D Barrows

doi:10.5539/ass.v16n4p74

Abstract

This study reviews research and provides discussions on various aspects of optimal currency areas, the link between debt and growth rates, and government debt levels for the PIIGS countries which consist of Portugal, Ireland, Italy, Greece, and Spain. Ten years after the Great Financial Crisis (GFC), and five years after 2013, the year of peak debt levels to GDP for the PIIGS countries and the year of the lowest real GDP levels between 2011 and 2018 for the PIIGS countries, this study provides an assessment of PIIGS country performance relative to each other and to the EU. The study time frame includes the years 2013 and 2018 using twelve measurements grouped into four sections which provide insight into the economic performance of the PIIGS countries. The sections are Trade Flows, Industry / Debt / Foreign Direct Investment (FDI), Demographics, and Economic Outcomes. Based on a summary analysis of the measurements, the overall ranking is: Ireland, followed by the EU, Spain, Portugal, Italy then Greece.

Highlights

The European Union (EU) was created in 1957 for the implementation of the free movement of goods, services, labor, and capital which established a formal economic relationship for the EU members (EUR-Lex, 2019)
Within the PIIGS countries, Ireland has the highest proportion of 25-34 year olds with tertiary education at 56.2% with Portugal at 35.1%; Italy at 27.7%; Greece at 42.8%; and Spain at 44.3% (OECD Edu, 2019)
Other benefits for Ireland include the use of the English language and a location that is adjacent to the United Kingdom, in addition to being geographically and culturally closer to the United States than the other PIIGS countries

Summary

Introduction

The European Union (EU) was created in 1957 for the implementation of the free movement of goods, services, labor, and capital which established a formal economic relationship for the EU members (EUR-Lex, 2019). With regard to the reduction of armed conflicts as well as the development of a single market on the continent, the EU implementation is deemed by most to have been a success, at least when based upon these criteria. In 1992, the Economic and Monetary Union (EMU) was created paving the way for the introduction of a currency to be administered by the European Central Bank (ECB) with the launch of the euro on 1 January 1999 (EUR-Lex, 2019). The use of a single currency eliminates exchange rate risks, “prevents protectionist policies”, and provides the potential for a low inflation environment (Pureza & Mortagua, 2016)

Methods

Results

Discussion

Conclusion