The Council of Ministers approved today the Stability Program (2013-2016) and the National Reform Plan, the two basic documents that contain the Government's economic policy strategy, within the European commitments. In them a diagnosis is made of the situation that the Spanish economy is going through, a realistic scenario is established for the coming years and the measures to be adopted are set. The objective is to persevere in the correction of imbalances and lay the foundations for recovery and job creation, which will arrive in 2014.

The forecasts presented today place for the coming year the exit of the recession, with an economic growth of 0.5%, compared to a fall of 1.3% this year. The downward revision of growth in 2013 is part of the usual periodic updates. It responds, above all, to a worse international context and is in line with the reviews of organizations such as the IMF or the European Commission. This scenario is compatible with a profile of mild deceleration in negative inter-quarterly rates in the remainder of the year and the start of the relaunch of the activity in early 2014.

The expected economic recovery is based on the foreign sector, as domestic demand will take a positive contribution to growth. While private consumption stabilizes in 2014 and begins to register positive rates in the two following years, the Administrations sector registers downward variations as a result of the necessary fiscal consolidation. The investment (gross fixed capital formation) takes off in 2015 and grows strongly (4.3%) a year later. Together, the national demand begins to register a positive contribution to growth in 2016.

External demand, on the other hand, maintains a positive contribution to growth. This year it will contribute 2.4 points to GDP on a downward path until 2016, on the basis that domestic demand will gradually take over. The goal is to achieve a more balanced growth pattern. During these years, the strength of exports will continue, up to 7.1% in 2016, reflecting the strong competitiveness gains of the Spanish economy. Imports are also on the rise, in parallel with the recovery of the economy.

Spain will already register this year financing capacity against the rest of the world (1.9 points of GDP), which means a change of sign with respect to the most recent situation and reach levels never achieved in the Spanish economy. This is the correction of an imbalance necessary to overcome the recession, since it implies that Spain is considerably reducing its debtor position vis-à-vis the outside. This improvement will be perceived mainly in the private sector and will allow debt amortization and financing of consumption and investment expenses.

The forecasts on the evolution of employment indicate that the destruction of jobs is slowing down, until positive rates are reached in 2015. These data, measured on an annual average, are compatible with a trend change profile and next year, with inter-quarterly rates positive. The recent labor reform and greater flexibility in the labor market will allow the Spanish economy to continue with the competitiveness improvements derived from the moderation of costs and prices. The objective is that the Spanish economy creates more employment in relation to GDP than in previous years. The unemployment rate flexes in 2014 (up to 26.7% of the active population), to be below 25% in 2015.



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