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ARCHIVED - Spain expected to escape the 2023 recession that threatens the UK, according to IMF
Spain looks set to become the fastest-growing economy in the Eurozone next year
According to the International Monetary Fund (IMF), Spain will be one of the few European countries to avoid a “technical recession” in 2023 and should in fact experience “strong growth,” with the GDP tipped to increase by 1.2% during 2023.
A country’s economy enters a technical recession only if its GDP falls for two or more consecutive quarters.
Far from entering into a recession, if Spain continues on target then it will be the fastest-growing economy in the Eurozone next year.
“Spain is one of the countries for which we are not expecting a recession next year – a time when it will experience strong growth,” according to IMF director for Europe, Alfred Kammer.
However, like so many of its neighbours, Spain can’t avoid suffering from a “weakened demand” and “falling consuming confidence” as prices continue to rise.
The impact of the economic crisis will be felt much more strongly in the UK, according to financial experts, who have predicted that the economy will continue to shrink between October and June, spiraling it into a recession that will last well into the summer.
Hywel Ball, the chair of the UK economic forecast group EY Item Club, explained: “There’s no doubt the UK economy faces a difficult period ahead, with global headwinds adding to domestic pressures.
“The silver lining is that the Government’s intervention on energy bills is expected to limit the extent of the downturn, while ONS data suggests that households have access to a larger cushion of pandemic savings than previously thought.”
These measures should also calm inflation somewhat, but since it will continue to outstrip salary growth until 2024, the average person will still feel a definite pinch.
Even though Spain has already come close to hitting its pre-pandemic figures this summer, the IMF believes that the economy won’t fully regain its strength for another two years, despite the positive forecasts.
Image: Freepik
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