Economy of Western Europe

There was also an attempt to expand economic integration outside Europe to limit the effects of market competition: with this spirit, in 1961, the OECD was born, which includes numerous non-European countries, such as the United States, Canada, Australia etc. Conversely, the most difficult period for the European economy must have been the one between the end of the 1960s and the beginning of the 1980s. While the thrust of reconstruction was exhausted, rapid processes of obsolescence of the oldest industrial complexes began, starting with the British one; migratory movements became noticeably more rigid, progressively diminishing that albeit “unjust” form of compensation for the imbalances between labor supply and demand; a little in all the countries of Western Europe there were profound social tensions, which led to the workers and student uprisings of 1968 and the spread of terrorism in the years immediately following, with serious repercussions on the functioning of economic activities; finally, in 1973, the first shock petroleum exposed the weakness of production apparatuses excessively dependent on the outside for the fundamental energy supply. The growth rates of the gross product, which until then had remained on average at annual values ​​of 5-6%, masking the absence of real integration within the EEC itself (whose first enlargement took place, precisely in 1973, in conditions of great uncertainty) and the fragility of other structural conditions (in agriculture, in heavy industry, in the monetary system), suffered a real fall and gave way to high inflation rates, a striking sign of a crisis that involved, before everything, the levels of employment. Attempts to deal with this emergency with increasingly costly public interventions in the productive sectors and social services only aggravated the situation of the national economic accounts, especially in countries such as the United Kingdom and Italy; on the other hand, the difficult conjunctures of the steel industry, petrochemicals and key industries such as the automotive industry highlighted the reversal of the central position of Europe: from a power factor to a determinant of a real crushing between the two economic blocs US and Soviet, to which was added the invasion of the internal market by Japan and the newly industrialized countries, especially Asia. Only the Federal Republic of Germany appeared capable of counteracting external forces – at least those of a strictly economic nature – and was assuming a sort of hegemony, which resulted, during the Eighties, in an excessive appreciation of the mark compared to other European currencies.

Meanwhile Eastern Europe, “protected” by the closed system of the COMECON, seemed to receive less repercussions from the energy crises (thanks to the hydrocarbon resources provided by the USSR) and at the same time manifested some new development trend, in the sense of a at least apparent opening towards the “light” industrial sectors. Here, too, there was no lack of strong gaps between some countries (such as the German Democratic Republic and the Hungary according to countryaah) whose standard of living could somehow approach Western levels and others (such as Bulgaria and Albania) stuck in conditions of profound underdevelopment. And here too, after the ferment of the ” Spring of Prague “(1968) and the subsequent harsh repression, a significant novelty emerged on the social level: the creation (1980), initially highly opposed, of a free union of Polish workers, known as Solidarność, which since then became the symbol of the changed relations between government oligarchies and masses of the population. During the Eighties, the economies of Western Europe recorded, albeit slight and uncertain symptoms of recovery, linked – once again – to an external factor, namely the drastic reduction in oil prices, which was only marginally affected by the finding of conspicuous fields in the North Sea by the United Kingdom. The further enlargements of the EEC (1981 and 1986) towards the south of the continent seemed to accentuate the geographical imbalances and placed the Community bodies in front of an unavoidable choice: the effective realization of the single market (1993), whose effects on the organization of agricultural, industrial and service enterprises engaged all member countries (since 1995 also Austria, Sweden and Finland) and, consequently, the entire continent in a fierce competition for efficiency and productivity. But, certainly, the best prospects of a process of economic integration finally extended to Europe as a whole, with multiplying effects on a world scale, opened at the beginning of the nineties, with the accelerated liberalization phase that has affected the countries of the East and with the German reunification. The start of this phase immediately proved fraught with problems, as it seemed inevitable: the abolition or downsizing of state leadership has placed economies that have been “hibernating” for decades. misunderstanding of full employment (translated, in fact, into underemployment) and without any external feedback on the monetary level in the face of the need to reconvert – or even reconstitute – one’s own productive apparatus, exposing it to the pitfalls of the free market, not only international, but also internal.