The Minister of Economy and Competitiveness, Luis de Guindos, participated today in the 18th Annual European Financial Conference of Goldman Sachs that is being held these days in Madrid. During a meeting with investors, the minister said that “as a result of the measures adopted in the last two and a half years, the Spanish economy is already on the path of growth and has an ascending profile. With the second quarter of this year, there will be four consecutive quarters of growth. All the indicators that we know suggest that the second quarter could be better than the first ”. "Government projections are below consensus," he added.
“At the beginning of the legislature, the Spanish economy faced a situation of serious economic crisis and credibility, due to the accumulation of macroeconomic imbalances and inaction. Today, after adopting draft measures, which include the consolidation of the financial sector, fiscal consolidation and labor reform, Spain has returned to the path of growth and job creation, on a solid basis. ” He also stressed the "effort" of Spanish society and now that effort "has to be rewarded."
In relation to the Spanish financial system, De Guindos said that "it has undergone an unprecedented exercise of transparency and sanitation, which allows it to face the asset valuation exercise and stress tests with full guarantees." The main lesson of this process is that "transparency is much more important than capital."
Asked about the future presence of foreign capital in Spanish credit institutions, the minister said that "the Government has no preconceived ideas about the ownership of Spanish entities by foreign investors." “Sales of nationalized entities to foreign investors have already been made, which shows the investment interest in Spain. At the present time, the FROB is negotiating the Catalunya Caixa sale and this will take place before August.
Asked about the context of low inflation that crosses the euro zone, he pointed out that it is important to differentiate between deflation and low inflation. In the case of Spain, low inflation has had positive effects in two areas, mainly the improvement of the competitiveness of the Spanish economy and the increase in the purchasing power of families. This has facilitated the internal adjustment that was necessary to carry out to correct the main imbalances accumulated in the past by the Spanish economy. In the case of the euro zone, the European Central Bank has reiterated its commitment to meeting the inflation target within its monetary policy mandate.
Finally, the minister reiterated that in the face of situations such as the one that Spain has gone through in the last two and a half years, each country must apply its own policies according to its circumstances. It is essential to make a correct diagnosis and have the determination to apply the necessary measures for its correction. In his opinion, it has been shown that the recipe that combines fiscal consolidation measures and structural reforms gives good results.
