The EU in the world - industry, trade and services

Data extracted in April 2018.

Planned article update: June 2020.

Highlights

In Japan, Brazil, South Africa , the United States and the EU, industrial output in 2017 had still not returned to the levels before the financial and economic crisis.

Among the G20 members, tourists from the United States spent the most number of nights in tourist accommodation in the EU in 2016.

Turkey recorded the largest receipts from tourism relative to GDP among the G20 members in 2016, although this was lower than in 2006.

Tourism receipts, 2006 and 2016
(% of GDP)
Source: the World Bank (World Development Indicators)

This article is part of a set of statistical articles based on Eurostat’s publication The EU in the world 2018.

The article focuses on industrial and service activities in the European Union (EU) and the 15 non-EU members of the Group of Twenty (G20). It uses short-term business statistics (STS), structural business statistics (SBS) and tourism statistics to give an insight into the EU’s business economy in comparison with the major economies across the rest of the world, such as the EU’s counterparts in the so-called Triad — Japan and the United States — and the BRICS composed of Brazil, Russia, India, China and South Africa.

Full article

Short-term business statistics

The bar charts presented in Figures 1 and 2 illustrate developments for the industrial production index and for the domestic industrial output price index using key short-term business statistics. The rates of change presented here are calculated from annual indices but the underlying series are normally monthly or quarterly data which facilitate a rapid assessment of the economic climate.

In five G20 members industrial output in 2017 had still not yet returned to pre-crisis levels

The impact of the financial and economic crisis on industrial activities and the subsequent recovery was substantial in several G20 members and this is reflected in the 10 year annual average rate of change between 2007 and 2017. Five of the G20 members — Japan, Brazil, South Africa (manufacturing only), the United States and the EU-28 — reported negative annual averages for this 10 year period, indicating that in real terms the level of industrial output in 2017 had not yet returned to its pre-crisis level observed in 2007. Over the period studied, India (3.9 %) and Indonesia (4.1 %; manufacturing only) reported the third and second fastest annual average growth rates in industrial output among the G20 members, with the fastest growth in Saudi Arabia (6.0 %; manufacturing only; 2010-2016). Looking at the latest annual rate of change, between 2016 and 2017, Turkey recorded the fastest growth in industrial production, up 6.3 %, just over double the growth recorded in the EU-28 (3.1 %). South Africa (manufacturing only) was the only G20 member for which data are available to report a fall in output in 2017.
Figure 1: Industrial production index, 2007-2017
(%)
Source: Eurostat (sts_inpr_a), the International Monetary Fund (International Financial Statistics) and the OECD (Main Economic Indicators)

The domestic industrial producer price index is a business cycle indicator whose objective is to measure the development of transaction prices of industrial activities within the domestic market.

Over the 10 year period from 2007 to 2017, industrial output prices in Japan and China (2007-2015; total industrial producer price index) were almost unchanged, showing an average annual fall of 0.1 % in the former and a rise of the same amount in the latter. The next lowest annual averages over this period among the G20 members for which data are available were price increases of 1.2 % in the EU-28 and South Korea and 1.5 % in the United States, Canada (both manufacturing only) and Australia. Elsewhere, annual average domestic industrial producer prices rose more rapidly, ranging from 4.7 % in Mexico to 14.7 % in Argentina (2007-2014; total industrial producer price index). The latest annual rates of change (2017 compared with 2016) confirm that industrial producer prices rose at a rapid pace in Turkey, up 15.8 %, followed at some distance by an increase of 9.8 % in Mexico.
Figure 2: Industrial producer price index
(domestic), 2007-2017
(%)
Source: Eurostat (sts_inppd_a), the International Monetary Fund (International Financial Statistics) and the OECD (Main Economic Indicators)

Structure of the economy

Figure 3 presents illustrates the economic structure in the G20 economies, using national accounts data to group economic activities into seven broad headings based on the ISIC Rev.3 classification; note that the heading of other activities includes a range of service activities, among which, financial intermediation, business, social and personal services, as well as many traditionally public services. In 2016, this disparate group of activities contributed at least half of the total gross value added of the economies of the United States and Australia and their share was close to this level in Canada (49.9 %) and the EU-28 (48.1 %) — see Figure 3. Brazil (46.2 %) was the only other G20 member where the share of other activities was above the world average (44.4 %). Nevertheless, in all of the other G20 countries except for Indonesia, other activities were the largest of the seven activity groupings shown; in Indonesia, manufacturing was the largest activity. Elsewhere, manufacturing was the second largest activity in value added terms worldwide, in the EU-28 and in China, Japan, South Korea and Turkey. The gross value added share of manufacturing peaked at 29.3 % in South Korea while it was 6.7 % in Australia, the only G20 member where it was below one tenth. In most of the remaining G20 members distributive trades, hotels and restaurants was the second largest activity in value added terms, although in Saudi Arabia mining and utilities was the second largest activity and in India agriculture, hunting, forestry, fishing was the second largest activity. India and Indonesia were the only G20 members where agriculture, hunting, forestry, fishing contributed more than one tenth of gross value added.
Figure 3: Gross value added by economic activity, 2016
(% of total gross value added)
Source: the United Nations Statistics Division (National Accounts Main Aggregates Database)

SMEs and large enterprises

Figure 4 focuses on industrial activities, including mining and quarrying, manufacturing and utilities. The data show the share of industrial employment in enterprises of different size classes. These size classes are defined in terms of the number of persons employed and range from micro enterprises with less than 10 persons employed to large enterprises with 250 or more persons employed. Collectively, the enterprises which are not large are often referred to as small and medium-sized enterprises (SMEs).
Figure 4: Industrial employment by enterprise size class, 2015
(% of the total number of persons employed)
Source: Eurostat (sbs_sc_sca_r2) and the OECD (SDBS Structural Business Statistics (ISIC Rev. 4))

Large enterprises generally have higher labour productivity than SMEs and so their share of industrial employment tends to be lower than their share of value added. Across the EU-28, large industrial enterprises employed 43.2 % of the total industrial workforce in 2015. The lowest employment shares for large enterprises were observed in South Korea (2014 data; definition differs), Turkey (manufacturing only) and Japan (2014 data), all with lower shares than in the EU-28. By contrast, large enterprises employed more than half of the industrial workforce in Brazil (2014 data), Mexico (2013 data), Canada (definition differs) and the United States (definition differs). Micro enterprises employed a relatively high proportion — close to one quarter — of the industrial workforce in South Korea, Mexico and Turkey.

Tourism

A tourist (also known as an overnight visitor) is a visitor who stays at least one night in collective or private tourist accommodation in a specified geographical area. Tourists include residents (domestic tourists) and non-residents (international tourists). Note that international tourists are classified according to their country of residence, not according to their citizenship. As such, citizens residing abroad who return to their country of citizenship on a temporary visit are included as international tourists, although in practice not all countries follow this approach.

The number of arrivals of tourists from outside the EU in the EU-28 relative to the size of population increased about 60 % between 2006 and 2016

There were around 1.24 billion international tourist arrivals worldwide in 2016, among which 482 million were in the EU-28: note that this EU total includes arrivals in EU Member States of international tourists from other Member States. Relative to population size, there were 559 and 546 international tourist arrivals per 1 000 inhabitants in Saudi Arabia and Canada in 2016, by far the highest ratio among the G20 members and more than 3 times the world average of 167 per 1 000 inhabitants (see Figure 5). The next highest ratios were in Turkey, Australia and South Korea where the ratio was more than double the world average. Most of the remaining G20 members received between 100 and 275 international tourist arrivals per 1 000 inhabitants in 2016, with some of the G20’s most populous countries — Indonesia, China, Brazil and India — below this range.
Figure 5: International tourist arrivals at frontiers, 2006 and 2016
(number per 1 000 inhabitants)
Source: Eurostat (demo_gind) and the World Bank (World Development Indicators and Health Nutrition and Population Statistics)

Estimates of the number of international arrivals in the EU-28 of tourists from outside the EU (therefore excluding arrivals in EU Member States of international tourists from other Member States) show an increase of around 60 % between 251 per 1 000 inhabitants in 2006 and 402 per 1 000 inhabitants in 2016. Worldwide, the number of international tourist arrivals relative to population size increased 28.8 % between these years. Japan’s ratio increased greatly during this period, more than trebling, while the ratio of international tourist arrivals to population more than doubled in India, South Korea and Indonesia. Australia, Argentina, Brazil, China, Russia and South Africa all observed growth for this ratio that was below the world average, while the ratio fell 2.6 % in Canada.

Among the G20 members, in 2016 tourists from the United States spent the most number of nights in tourist accommodation in the EU-28

Tourist accommodation refers to every type of establishment or dwelling where tourists can be lodged, including hotels, short-stay accommodation, campsites, and similar establishments.

The total number of nights spent in tourist accommodation in the EU-28 from all countries of the world (including nights spent by residents) was 3.1 billion in 2016, of which 2.6 billion (or 86.0 %) were from EU-28 Member States. Nearly half of the nights spent in tourist accommodation in the EU-28 by tourists from outside the EU were by tourists from the 10 G20 members shown in the bar chart in Figure 6; collectively they accounted for 6.9 % of all nights spent in tourist accommodation in the EU-28. Tourists from the United States spent 74.4 million nights in tourist accommodation in the EU-28 in 2016, 2.4 % of the total.
Figure 6: Number of nights spent in tourist accommodation by country of origin, EU-28, 2016
(% of total nights of people from all countries of the world)
Source: Eurostat (tour_occ_ninraw)

In 2016, Turkey recorded the largest receipts from tourism relative to GDP among the G20 members, although this ratio was lower than in 2006

Tourism is crucial for many countries, offering employment opportunities and a considerable revenue stream; this is particularly true for a number of developing and emerging economies which have been transformed by a growth in tourism.

International tourism receipts include payments (and prepayments) in a country by international tourists, including payments to domestic carriers for international transport. These receipts were valued at 3.1 % of GDP in Turkey, 3.0 % in South Africa, 2.9 % in Australia and 2.7 % in the EU-28, the highest such ratios among the G20 members in 2016 (see Figure 7). In most of the other G20 members, international tourism receipts ranged from 1.0 % to 2.0 % of GDP, with Japan, China and Brazil below this range; the world average was 1.8 %.
Figure 7: Tourism receipts, 2006 and 2016
(% of GDP)
Source: the World Bank (World Development Indicators)

Between 2006 and 2016, the ratio of international tourism receipts to GDP increased by 0.1 points worldwide and by 0.2 points in the EU-28. Among the non-G20 members this ratio fell in China (down 0.8 points), Argentina (0.7 points), Turkey and South Africa (both down 0.4 points), while it was relatively unchanged (increase or decrease of at most 0.1 points) in Canada, Brazil, Russia, India, Indonesia and Australia. Growth in this ratio was stronger in the United States, Japan (both up 0.4 points), Mexico, Saudi Arabia (both 0.6 points) and South Korea (0.7 points). In relative terms, the largest increase was in Japan, where international tourist receipts more than doubled from 0.3 % of GDP in 2006 to 0.7 % in 2016; the largest decrease was in China, where GDP growth outstripped the growth in international tourism receipts such that the ratio in 2016 (0.4 %) was approximately one third of its level in 2006 (1.2 %).

Data sources

The statistical data in this article were extracted during April 2018.

The indicators are often compiled according to international — sometimes worldwide — standards. Although most data are based on international concepts and definitions there may be certain discrepancies in the methods used to compile the data.

EU data

Most of the indicators presented for the EU have been drawn from Eurobase, Eurostat’s online database. Eurobase is updated regularly, so there may be differences between data appearing in this article and data that is subsequently downloaded. Some of the data have been extracted from international sources for reasons of comparability or availability.

G20 members from the rest of the world

For the 15 non-EU G20 members, the data presented have been compiled by a number of international organisations, namely the OECD, the International Monetary Fund, the United Nations Industrial Development Organisation and the World Bank. For some of the indicators shown a range of international statistical sources are available, each with their own policies and practices concerning data management (for example, concerning data validation, correction of errors, estimation of missing data, and frequency of updating). In general, attempts have been made to use only one source for each indicator in order to provide a comparable dataset for the members.

Context

Industrial activities such as manufacturing are integrated with many service activities such as transport and communications, distribution and business services, which in turn depend on industry to produce the equipment and hardware they use. Creating a positive climate in which entrepreneurs and businesses can flourish is considered by many as the key to generating growth and jobs; this is all the more important in a globalised economy, where some businesses have considerable flexibility to select where they operate.

The EU is a major tourist destination, with six of its Member States and one of its candidate countries among the world’s top dozen destinations for international tourists in 2016. Tourism has the potential to contribute towards employment and economic growth, especially in rural, coastal, peripheral or less-developed areas.

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SBS - main indicators (sbs_na)
Annual enterprise statistics by size class for special aggregates of activities (NACE Rev. 2) (sbs_sc_sca_r2)
Industry (sts_ind)
Production in industry (sts_ind_prod)
Production in industry - annual data (sts_inpr_a)
Producer prices in industry (sts_ind_pric)
Producer prices in industry, domestic market (sts_inpp_d)
Producer prices in industry, domestic market - annual data (sts_inppd_a)
Annual data on tourism industries (tour_inda)
Occupancy of tourist accommodation establishments (tour_occ)
Nights spent by residents and non-residents (tour_occ_n)
Nights spent at tourist accommodation establishments by country/world region of residence of the tourist (tour_occ_ninraw)
Arrivals of residents and non-residents (tour_occ_a)
Arrivals at tourist accommodation establishments by country/world region of residence of the tourist (tour_occ_arnraw)
Annual data on trips of EU residents (tour_dem)
Number of tourism trips (tour_dem_tt)
Number of trips by country / world region of destination (tour_dem_ttw)