According to Credit Suisse' Global Wealth Report 2021, they have also all experienced major economic impacts, including those due to reduced tourist flows from northern Europe.
Real GDP declined in Greece, Italy and Spain in 2020 by an average of 9.4% and within a relatively narrow range: Greece saw a drop of 8.3%, Italy 8.9% and Spain 11.0%.
As elsewhere in Europe, the effects on unemployment were relatively small, with the average unemployment rate rising from 13.4% at the end of 2019 to 14.1% in Q3 2020.
Unemployment grew most in Spain, where the rate rose from 13.8% to 16.6% in 2020 before easing back slightly in Q4 2020.
Among these countries, the IMF expects real GDP growth to average 4.8% in 2021 and 4.4% in 2022, before falling to 1.2% in 2025. For 2021–22, the average annual GDP growth rate is forecast to be 3.9% in Italy, 4.4% in Greece and 5.5% in Spain.
These increases reflect the fact that, while personal disposable income fell by 2.2.% on average in 2020 across the three countries, private consumption fell even more, by 8.9%.
However, consumption is expected to rise 6.8% in 2021, outstripping growth in disposable income by 2.8%. Hence the 2020 rise in personal saving may well be short-lived.
At the end of 2020, wealth per adult stood at €88.008 in Greece, €201290 in Italy and €191091 in Spain. From 2000 to 2020, wealth per adult rose at an average annual rate of 2.0% in Greece, 3.5% in Italy and 5.6% in Spain, thus increasing the wealth gaps among the three countries.
Shifting from frinancial to non financial assets
According to Credit Suisse, the period 2000–20 saw the composition of assets in Greece, Italy and Spain shift to some extent from financial assets to non-financial assets.
Financial assets averaged 37.7% of gross assets in 2000, but 35.4% in 2020. The ratio of debt to gross assets rose in Greece and Italy from an average of 5.3% in 2000 to 10.6% in 2019, but fell in Spain from 11.3% to 9.8%. These debt ratios are low to moderate by international standards.
Although wealth inequality is relatively low in these three southern European countries, the wealth Gini coefficient has risen in Italy and Spain. The trend in Greece was different.
The Gini value fell from 69.6 in 2000 to 65.7 in 2020, and the share of the top 1% also declined from 25.3% to 20.4%.
Falling wealth inequality in Greece reflects the long-drawn-out crisis of the Greek economy in the aftermath of the global financial crisis. This reduced the value of shares and businesses of most kinds, inflicting large capital losses on higher net worth individuals
