Allianz Euro Monitor 2015

At 1.5% in 2015, economic growth in the eurozone was still not exactly sizzling. It has, however, gained in breadth and resilience. This is illustrated by the Allianz Euro Monitor, which in 2015 improved for the third year running. The health of the eurozone economy is measured using 20 indicators, encompassing the categories “Fiscal sustainability”, “Competitiveness”, “Employment and productivity” and “Private and foreign debt”. The indicators are assigned a score of 1 to 10 (best score), the average of which provides the overall rating. For the eurozone as a whole the overall indicator 2015 reached 6.6 points, its highest level since 2007. Fifteen countries notched up a higher score than in 2014, only three slipped back (Estonia, Greece and Lithuania).


Germany again led the field with regard to economic stability with an overall score of 8.1 points, followed at some distance in second and third place by Luxembourg and Slovakia. Climber of the year is Ireland, up 6 places in the overall 2015 ranking to 4th place. In 2010 it had ranked second to last.


Despite a modest improvement, the most worrying indicator remains the unemployment rate, while the current account indicator again saw the best results. With the exception of Cyprus, all eurozone member states were more or less in balance or recorded a surplus in 2015.


With the 2015 Euro Monitor we have introduced for the first time a breakdown of the indicator set into longer-term indicators on the one hand and shorter-term indicators on the other, that flag up progress in addressing weaknesses. It is striking that a number of countries perform very differently on the respective components. Economies with the fewest shortcomings with regard to existing imbalances tend to belong to the weaker performers when it comes to progress towards economic stability. Conversely, the former crisis countries still display relatively large imbalances but are among the leaders in terms of progress in reducing imbalances. It is perhaps not surprising that countries with major adjustment needs make greater efforts than those with only moderate adjustment needs. Interpreted negatively, however, this might signify that relatively well-placed countries are living off their earlier successes.


All told, the results of the Euro Monitor 2015 illustrate that the eurozone is slowly but steadily gaining in economic stability. The reform and consolidation efforts of recent years are bearing fruit, but now is not the time to relax. Reforms aimed at boosting future growth are still essential – for all eurozone member states. The former problem countries are likely to need a few good years yet before we can talk of a return to economic stability. Conversely, countries such as Germany should not lean back and rest on the laurels of a healthy economic base as this will otherwise erode over time.