11/11/2021 at 11:08 am CET
The growth of the Spanish economy it will continue to be strong but much lower than expected just three months ago. The European Commission joined other organizations such as the International Monetary Fund, the Airef or the Bank of Spain and cools the macroeconomic projections of the government of Pedro Sánchez although with the more pronounced hack of all. Brussels estimates that the growth of the Spanish gross domestic product will be 4.6% this year and 5.5% in 2022, almost two points lower than what the Spanish executive forecasts for this year (6.5% ) and a point and a half (7%) the next.
The estimate is also very lower than expected by the team Ursula von der Leyen just three months ago. Then Brussels revised growth upwards, predicting an increase this year of 6.2% and 6.3% next year, which is now declining. Despite the new figures, the Commission estimates that since the lifting of the state of emergency in mid-May, supported by a successful vaccination campaign, “the Spanish economy has entered into a steady recovery & rdquor; with a service sector – including leisure and tourism – supporting this rebound. Job creation has also accelerated in recent months, while confidence indicators remain high for both industry and services.
This diagnosis leads the European Commission to believe that growth will remain strong, driven mainly by private consumption. “After the rebound in the second half of 2021, the Spanish economy will continue to grow in 2022 and close the gap with its pre-pandemic level for the first quarter of 2023 & rdquor ;, underlines the new analysis of the Commission which points to the plan recovery and resilience – which will allow Spain to access up to 140,000 million euros in the years to come – as one of the engines of this economic recovery which will stimulate public and private investment.
Risks on the horizon
Indeed, “economic activity is expected to continue to expand in 2023″, still driven by spending and reforms financed by the stimulus plan, even though quarterly growth rates will tend to moderate. This scenario will lead to a growth of the Spanish GDP of 4.4% in 2023. An estimate which is not without risks, in particular resulting from the pandemic of covid19. “Although the uncertainty has considerably reduced thanks to the control of the health situation at the national level, several risks still weigh on the outlook. The persistence or resurgence of the pandemic in other countries could influence economic growth, in particular by delaying a full recovery of the tourism sector & rdquor;, warns the Commission.
Other risks on the horizon relate to supply, energy and transport price bottlenecks that could delay recovery in the short term while labor market mismatches could affect implementation. green and digital investments linked to the recovery plan. In any case, the document also acknowledges that the implementation of key stimulus package reforms – it does not explicitly mention pensions or work – could also have a strong impact on the rebound.
Regarding the development of inflation, and despite the measures adopted by the government, Brussels predicts that it will remain at record levels until the second quarter of next year with an indexation of pensions which will increase the pressure on the economy. core inflation. As in previous forecasts, the Commissioner’s team Paul Gentiloni positively values job protection programs such as ERTEs which have helped mitigate “job destruction during the early stages of the COVID19 crisis and paved the way for a rapid labor market recovery”.
The numbers, according to the analysis, speak for themselves. “Both the number of workers and the unemployment rate are roughly back to pre-pandemic levels, although around 200,000 employees are still subject to ERTE (1% of total employment) & rdquor; , they point out. Brussels notes that the Spanish government plans to replace the current extraordinary regime with a new one of a structural nature, focused above all on retraining and improving the skills of workers. All of this will lead Spain to reduce its unemployment rate to 15.2% in 2021, 14.3% in 2022 and 13.9% in 2023.
Regarding the deficit and debtAlthough the rules of the Stability and Growth Pact will remain frozen next year and will not be reactivated until 2023, the Commission is confident that Spain will continue to move closer to the maximum thresholds established in the rules. After hitting an 11% budget hole in 2020, Brussels predicts that the deficit will be reduced to 8.1% this year and 5% in 2022. Debt, on the other hand, will rise to 120.6% this year and it is predicted that this will start to redirect the next one to close with 118.2% and 116.9% in 2023.