Economic and social disparities in the EU

A homeless man having a meal in Bratislava.
In the St Vincent de Paul refuge for the homeless in the capital of Slovakia, Bratislava, more than 150 people find a safe place to sleep and a hot meal. © SDC

Enlargement towards the east presented the EU with new challenges. Although the new EU member states are catching up, significant disparities in the countries’ development remain. For the EU, strengthening economic and social cohesion is a key concern. Switzerland is helping to overcome these challenges by making its own independent contribution. 

On 1 May 2004, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia – the EU 10 – joined the European Union. Three years later, on 1 January 2007, Bulgaria and Romania joined, and, on 1 July 2013, Croatia became the 28th member of the EU. This eastward enlargement has presented the EU with major challenges as the economic and social disparities in the union have become even more pronounced.

Economic environment in the new EU member states

The 13 new EU member states experienced a strong economic upswing between 2001 and 2007. Increasing integration in the global economy also increased these countries’ exposure to external shocks, however. The economic and financial crisis initially hit the new EU member states very hard. The 6.7% average economic growth rate of the EU 13 in 2007 had fallen to minus 6.8% in 2009. The situation has stabilised in the meantime. The economies of the EU 13 countries are, on average, back on a growth path, albeit at a significantly lower level.

Per capita income (adjusted to purchasing power parity) of the EU 13 is still well below the EU average with the shortfall ranging in 2015 from around 47% of the EU average in Bulgaria to 88% in Malta.

Support through the EU cohesion policy and EEA

In the period between 2014 and 2020, as part of its cohesion policy, the EU is spending a total of some EUR 194.1 billion in order to boost the level of economic and social wellbeing in the new EU member states.
Cohesion policy 2014 - 2020

In the five-year period from 2009 to 2014, the three countries of the European Economic Area (EEA), Norway, Iceland and Liechtenstein, also contributed some EUR 1.8 billion in support for the EU. Over the seven-year period 2014 – 2021, they will be contributing a further EUR 2.8 billion to the EU, of which Norway will be paying 97%.

EEA website