• Growth will continue to be sustainable and balanced, with positive contributions from internal and external demand
  • The balance of the current account balance will be maintained with surpluses close to 1.5% of GDP for four years
  • ANDhe Government will continue to commit to budgetary balance and will already register a public surplus in 2021
  • Economic growth will be intensive in job creation and 20 million people will be reached by 2020
  • The unemployment rate will continue to decrease until it reaches 10.7% of the active population at the end of 2021

The Council of Ministers has approved the Update of the Stability Program of the Kingdom of Spain (2018-2021) for submission to Brussels. The document includes a growth forecast of 2.7% this year and close to 2.5% annually until 2021, with which the Spanish GDP will chain eight consecutive years on the rise. In addition, a new more sustainable and balanced growth pattern is confirmed, with positive contributions from domestic demand and from the foreign sector.

The new forecasts are prudent and realistic and confirm that all the jobs lost during the crisis will be recovered, thus reaching the goal of 20 million employed in 2020. In addition, the public deficit will be at 2 this year, 2% of GDP with a primary surplus, reflecting the Government's commitment to budget balance. Spain will record a surplus in 2021, of 0.1%, for the first time since 2007.

The new projection estimates an average annual growth in these four years of close to 2.5%. For employment, the same rate is forecast for 2018 and slightly lower for the rest of the forecast period, which will allow the creation of 1.7 million jobs during these four years. The unemployment rate will drop to 10.7% at the end of 2021, a figure not reached since 2008, that is, since the start of the recession.

The growth differential will continue to be favorable to the Spanish economy compared to the main countries in our environment, so this behavior is not explained by the "tail winds", from which all economies have benefited, but for the correction of macroeconomic imbalances. Spain has been able, through the reformist drive and the efforts of households and companies, not only to overcome the greatest economic crisis in its democratic history, but also to lay the foundations to continue developing a healthier, balanced and sustainable economic model.

Like the macroeconomic table that accompanies the General State Budget Project (PGE) for 2018, the growth of 2.7% for this year represents an upward revision of four tenths compared to the previous revision due to several factors: greater investment , improvement of the international environment, positive impact of the measures included in the PGE Project and moderation of the economic uncertainty related to the situation in Catalonia, after the application of Article 155 of the Constitution. In addition, the most recent national and international indicators of activity and employment indicate a dynamism in the first months of 2018 higher than expected. In this sense, for the first quarter of the year, the INE shows growth of 0.7% quarter-on-quarter and 2.9% year-on-year.

In growth, there will continue to be positive contributions throughout the projection horizon of both national demand and net external demand, consolidating investment and exports as the most dynamic items of GDP, with the consequent favorable effect on productivity and potential growth of the Spanish economy. Among the components of national demand, private consumption is expected to continue growing at high rates, while within investment, the component of equipment and cultivated assets will maintain an expansionary path in a context of favorable business expectations and low interest rates. interest. Regarding the foreign sector, real exports of goods and services will grow above 4% in the 2018-2021 period, driven by gains in competitiveness.

Furthermore, sustained economic growth will continue to be compatible with progress in correcting the main macroeconomic imbalances. The balance of the current account balance is expected to be in surplus throughout the forecast period, standing at around 1.5% of GDP and thus contributing to the reduction of the debit balance of the net international investment position. Thus, in 2021 there would be eight consecutive years of growth and, at the same time, nine of current account surplus, an unprecedented milestone in our recent economy, especially when it is accompanied by a sustained period of growth in domestic demand.

In the financial field, an intense deleveraging process has been carried out in the private sector, consistent with a notable increase in new credit operations to households and SMEs. This deleveraging process is expected to continue in the coming years, reducing the vulnerabilities of the Spanish economy to possible external shocks.



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