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ARCHIVED - Disappointing GDP growth rate for 2021 in Spain
Spain’s GDP grew below average after registering the biggest collapse in the eurozone in 2020
The Spanish economy grew by just 4.9% last year, according to the annual predictions released by the International Monetary Fund (IMF) on Tuesday January 25. This figure is a far cry from the prediction made by the Spanish government when the 2022 budget was being finalised last September, which was confident that the economy would grow by 6.5%.
Furthermore, these disappointing numbers suggest that Spain now won’t fully recover from the pandemic crisis until the early part of 2023.
The National Institute of Statistics (INE) will publish its definitive GDP data for 2021 this Friday, but the preliminary figures are disheartening given that Spain suffered the largest drop in production of all the advanced economies in 2020 with a colossal drop of 10.8%.
In contrast, last year France grew at a rate of 6.7%, Italy did so at 6.2% and the average of the euro countries rose by 5.2%, with Spain lagging behind significantly. Only Germany, with a rebound of just 2.7% last year, having plummeted 4.6% in 2020, fared worse.
On the flip side, the forecasts for this year and next are somewhat more optimistic, with the IMF predicting that Spain’s GDP will recover at a rate of 5.8% year-on-year in 2022, a rebound that will ease off slightly to 3.8% in 2023. As usual, the government is more positive about the economy’s recovery, forecasting that Spain’s GDP will rise by 7% this year, something which virtually all analysts are ruling out at this point.
The latest developments in the pandemic and the economic consequences it has generated – namely, high inflation around the world – have led the IMF to draw a more pessimistic outlook for global recovery.
“The world economy enters 2022 in a weaker position than previously expected,” the experts explained, blaming mobility restrictions and the emergence of the Omicron variant for the poor performance, along with soaring energy prices and supply issues, although Malaga on the Costa del Sol is doing much better than the rest of Spain thanks to its great tourism industry.
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