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Real convergence in central, eastern and south-eastern Europe

Piotr Żuk, Eva Katalin Polgar, Li Savelin, Juan Luis Diaz del Hoyo and Paul König, (2018), “Real convergence in central, eastern and south-eastern Europe”, ECB, 10 May

This article establishes stylised facts about convergence and analyses the sources of economic growth in central, eastern and south-eastern European (CESEE) economies within and outside the European Union (EU).22 It also compares the performance across countries and identifies the challenges that these economies face on the way to further advancing convergence. Although all CESEE economies have converged towards the most advanced EU economies since 2000, progress has been heterogeneous. While some countries have experienced fast economic growth and a speedy catching-up, for others the catching-up process has been rather slow. Economic convergence has been much faster in the CESEE countries that became members of the EU (including those which later joined the euro area) than in the Western Balkan countries that are currently EU candidates or potential candidates. Convergence was particularly rapid before the global financial crisis, but slowed down thereafter.

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