Adriatic Surprise

The International Monetary Fund has released a staff analysis of economic competitiveness in the southern Euro area — France, Greece, Italy, Portugal, and Spain.  It’s a fairly technical document – written as a series of papers with a brief overview chapter at the start, which probably means that many of its messages will be missed.  But the bottom line is that all five countries are found to have done badly in most areas of competitiveness, meaning loss of export shares in global markets, lack of specialization in rapidly growing products and markets, and only limited success in services.  

Whether you’re surprised will depend on what you expected going in but for me the main news was the relative success of Greece, which rarely merits a mention as an EU tiger.   Greece seems to have 3 factors in its favour: a trade orientation towards its northern neighbours (who have been growing while still low profile in terms of competitor countries), tourism, and transport — all that Greek-owned shipping has been in heavy use around the world.   The world may be ever more mobile, but history and location still matter.