• The Stability Program (2016-2019) is elaborated with prudent and realistic assumptions and foresees solid and sustained growth
  • At the end of 2016, the level of income lost by the crisis will be recovered and the 20 million employed will be reached in four years
  • Employment growth will exceed 2% annually and the unemployment rate will drop to 14% in 2019
  • A positive differential growth of more than half a point will be maintained with respect to the euro area average
  • Net foreign debt will decrease thanks to current account surplus and financing capacity

The Spanish economy will maintain an average growth rate of 2.5% in the next four years and a total of more than 1.8 million jobs will be created, reaching almost 20 million employed in 2019, along with a decrease in unemployment in similar amount. These are the forecasts of the new macroeconomic table approved by the Council of Ministers and which appear in the Stability Program (2016-2019) sent to Brussels. These are prudent and realistic forecasts that support and make credible the path of reduction of the public deficit that places the fiscal imbalance below 3% next year and 1.6% of GDP in 2019.

The Stability Program forecasts extend four more years of economic growth and the exit from the recession that started in 2013 after five years of falling GDP and the destruction of almost 3.5 million jobs. It is estimated that the level of income that the Spanish economy had at the beginning of the crisis will recover at the end of 2016 and from there will consolidate an average annual growth rate of 2.5%. These are figures that will keep Spain at the forefront of economic growth and job creation among advanced countries. With regard to the partners in the euro area, the forecast is that a positive differential of more than half a point in growth will be maintained throughout these years.

The economic reforms carried out – labor, financial consolidation and fiscal consolidation – are behind the strength of the Spanish economy. The correction of macroeconomic imbalances and the improvement in competitiveness derived from the reforms can cushion the impact on growth of a complex international environment. The Stability Program projects a slight slowdown in the first two years derived mainly from external factors, such as doubts about China's growth, the fall in raw material prices and their effect in emerging countries, the volatility of markets or the exhaustion of the margins of action of monetary policy.

The sustained growth rate of the Spanish economy that is expected until 2019 is based on domestic demand, whose contribution will exceed an average of 2.5 points. Within domestic demand, investment will grow by around 5% per year on average, more strongly in the case of capital goods than in construction. Private consumption will maintain growth of around 2.5%. The foreign sector will improve its contribution to GDP growth and will be in balance from 2018.

Both unemployment and employment also prolong the positive cycle that started two years ago and which allow us to project the recovery of the levels of employment that the Spanish economy had before the crisis. By the end of 2019, it is planned to reach practically 20 million employees through an average annual growth rate of some 470,000 new jobs. The number of unemployed is estimated to drop around 1.8 million in these four years and the unemployment rate will drop from 22.1% in 2015 to the 14% expected for 2019.

Improvements in competitiveness and deleveraging of the economy will also reduce net foreign debt. This is due to the fact that throughout the period there will be a current account surplus and financing capacity compared to the rest of the world, above 2% of GDP in the latter case. If this forecast is confirmed, Spain will complete the longest cycle of positive balance in our accounts vis-à-vis abroad, with eight years in a row of financing capacity.

Source of the new