Real convergence

EU has free movement of products and services. Participation in EU is hurting countries with lower per capita income. Because of lower productiviity they are less competitive. Their domestic industries suffer, GDP suffers and per capita income is hit. Nevertheless EU - NWO have been getting away with this for a simple reason. People do not know how high growth rates their economy should have.

NWO - EU take advantage of their ignorance and present colossal failure as success. Even if GDP and per capita income suffer tremendously, it is possible that they increase. The impact of EU and Eurozone participation is on growth rates. They are much lower because of EU participation. People do not know how high the growth rates should be and do not realize the big blow on their economies because of participation in EU and Eurozone.

How much growth rate should a country have? It depends on the level of real per capita income. In general, countries that are at lower levels have more room for development and therefore can and should have higher growth rates. This does not happen in all cases but from a level of economic development and up. According to Rostow there are five stages of development; 1) traditional society 2) preconditions for take-off 3) take-off 4) drive to maturity 5) high mass consumption.

Countries that have laid the foundations for take-off and have not yet reached maturity, have the potential for high growth rates. Eastern European countries have a lower level of economic development compared to Western European countries and certainly have laid the foundations for take - off. So they could and should have much higher rates of growth than Western Europe's. This does not happen automatically but with the right economic policies.

Due to their participation in the EU and the Eurozone, they are deprived of this possibility. They must form a separate group in order to have high growth rates. Eastern European Group's model is ready. The 30 year economic plan is ready. They will reach Western Europe's level of per capita income in 25 - 30 years. The time needed is very closely related to growth rates.

Let's take two countries in Group 4, Russia and Greece. Greece is Eastern Europe's most damaged country due to EU and Eurozone participation. The reason is that it has been a member since 1981. Other Eastern European countries started joining in 2004, 23 years later. So their damage is much smaller. Russia is not in EU. Russia is the bigger economy in Group 4 and Europe and 5th globally.

Russia's and Greece's per capita income in purchasing power parity (ppp) is approximately the same. Turkey is also at the same level. It is the second biggest economy in the Group 4 and 11th globally. Russia and Greece participate in Group 4, in all scenarios. Turkey is in the Group with the original composition but does not participate in all alternative compositions.

We can find the ratio that compares per capita income of three countries in Western European Group 3 with Russia's and Greece's. These are; Spain 1,22, France 1,49, Germany 1,7. This means that Spain has 1,22 times higher income, France 1,49 times and Germany 1,7 times. When can Russia and Greece converge with these three Western European countries, in terms of per capita income?

In order for the two countries (Russia - Greece) to reach Spain's current per capita income, with an average annual growth rate of 2%, it will take 10 years. In 10 years, Spain will have a different per capita income, most likely higher. What will it take to reach Spain's future level in 10 years? Russia and Greece will need 2% ABOVE Spain's growth rate. That is, if Spain's average growth rate is 1%, they will reach its future per capita income in 10 years, if they have a growth rate of 3%.

In the case of France, it will take 20 years at a rate of 2%. With an average growth rate of 2%, in 20 years they will have France's current per capita income. They will need 2% ABOVE France's rate, to reach its future per capita income, in 20 years. If France has an average annual growth rate of 1%, they will need a 3% average rate.

The case of Germany is very interesting. It is the second biggest economy in Europe, after Russia and 6th globally. It is Western Europe's powerhouse but not Europe's because Russia is in first place. Germany is the biggest economy in Western Europe and Russia in Eastern Europe. The ratio between Germany and Russia - Greece is the same as Western and Eastern Europe's ratio. Germany has 1,7 times higher per capita income compared to Russia - Greece.

Western Europe has also 1,7 times higher per capita income than Eastern Europe. What holds for Germany and Russia - Greece is also true for Western and Eastern Europe. With growth rates of 2%, the two countries will reach Germany's current per capita income in 25 - 30 years. To reach Germany's future per capita income, they would need 2% ABOVE Germany's average annual growth rate. That is, if Germany has 1%, they must have 3%.

During the period 2013 - 2021, Germany, France and Spain had approximately 1% average growth rates. What would happen if instead of 2%, a higher growth rate is possible for Russia and Greece? They will reach Spain's current per capita income in 5 years, with 4% growth rate. For France it is 10 years and for Germany 10 to 15 years. To reach their future per capita income in these time periods, they would need 4% ABOVE their growth rates.

It is not certain that Germany, France and Spain will have 1% average growth rate. It could be more or less. If it is around 0%, their future per capita income would be same as current. Russia and Greece will need 2 + 0 = 2% or 4 + 0 = 4% growth rates for the time periods specified above, to reach Spain's, France's and Germany's future per capita income.

A 3% growth rate is not too optimistic for Russia, Greece and Eastern Europe overall but modest and realistic expectation. It can be higher than that. Suppose Western Europe has 1% growth rate. With 3% growth rate, Eastern Europe will reach its level in 25 - 30 years which is the realistic scenario. With 5%, it will take 10 - 15 years which is the optimistic scenario. It is necessary for Eastern Europe to form a separate group. If they are in the same group with Western European countries, it won't happen even in a thousand years!