The amount, higher than the forecasts of both the Government (4.4%) and the Bank of Spain (4.6%), places Spain in the advance squad of the most dynamic countries of the European Unionwhile the European Commission forecasts average growth of 3.3%.
Taking into account “the current situation, Spain had very good results,” especially when compared to “the other major European economies,” he told AFP. Rafael Pampillon, Professor of Economics at the San Pablo CEU University in Madrid.
Sign of the good progress of the economy, unemployment fell slightly to 12.87% of the active population last year, with a strong increase of the jobs with permanent contracts (+1.6 million), driven by a labor market reform that came into force in January 2022.
“In the face of the prophets of the apocalypse, today we have strong economic growth, the lowest inflation in Europe and record employment,” the president of the government, the socialist, congratulated himself on Twitter Pedro Sanchez.
Inflation
Indeed, Spain was one of the first countries affected by the escalation of inflation during 2022because of his lack of electrical connections with the rest of Europewhich prevented full competition and penalized Spanish consumers.
But after reaching a peak of 10.8% in JulyMadrid managed to reverse the trend and In December, inflation stood at 5.7%, the lowest figure in the Euro zone.
This was achieved thanks to the call “Iberian exception”granted by Brussels to Madrid and Lisbon, which allowed them exit the European energy tariff system and put a cap on the price of electricity. Added to this were plans to government help to sustain purchasing power.
These latest measures, aimed above all at fuel prices and rentalswith a global cost of 50,000 million euros (about 54,400 million dollars), “have allowed consumption to shift to other sectors” and thus “sustain activity” Rafael Pampillon said.
In parallel, Spain has benefited from numerous investmentsthanks to the funds from the European recovery plan -of which it is one of the main recipients- and the global appetite for renewable energybooming in this country.
Bad news
According to economists, a part of it is explained by a correctionsince Spain has been one of the countries that has taken the longest to recover of the Covid-19 crisis. In fact, The IMF estimates that Madrid will not recover its pre-crisis level until 2024.
In addition, the economy has experienced a significant slowdown since summer. According to the INE, the GDP barely grew 0.2% in both the third and fourth quarters. And for the Bank of Spain, this trend will continue in the first part of the current year.
Also the enormous resources destined to support the purchasing power have weighed on public financesin a country with one of the highest debts in Europe (116% of GDP).
The government, keen to highlight its good results as elections due later this year approach, is optimistic. “In 2023 we enter on the right foot,” the Minister of Economy recently asserted, Nadia Calvino.
The executive expects GDP to grow by 2.1% this year. This is a figure considered very optimistic by many economic organizations -such as the IMF, which forecasts 1.1%– that, however, recognize the “resilience” of the country.
Spain should once again show a performance “better than that of other countries in the euro zone” this year, according to the ING bank.
Source: Ambito
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