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Date Published: 27/01/2023

Spanish economy dodges recession and grows by 5.5 per cent

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Economic growth in Spain during 2022 far exceeded the predictions of financial experts

Spanish economy dodges recession and grows by 5.5 per cent

Spain appears to have dodged the economic slowdown feared by most of Europe and an ensuing recession, reporting a growth of 5.5% by the end of 2022, similar figures that were seen the previous year.

According to the National Institute of Statistics (INE), this is Spain’s highest rate since 1973 after the economy increased by another 0.2% in the last quarter.

The GDP plummeted by an incredible 11.3% at the height of the pandemic and the 5.5% growth registered in 2022 is actually 1.1 points higher than the financial analysts predicted. It’s also well above the projections of several big-name experts including the IMF (who forecast a growth of 5.2%), the Funcas panel (5%) and the Bank of Spain (4.6%).

See also: Forecast for the Spanish economy in 2023

Celebrating what is undoubtedly a huge financial win amid a global crisis, the Minister of Economic Affairs and Digital Transformation, Nadia Calviño, said the 5.5% growth has been achieved "in an international context of great uncertainty", marked by the consequences of Russia's war in Ukraine, which shows the "great solidity and resilience of the Spanish economy”.

While national demand actually dropped considerably last year, Spanish exports boomed and contributed 2.6 points towards the overall GDP, 2.3 points more than in 2021.

By economic sector, services led growth in 2022, with an increase in gross value added of 6.5%, followed by construction (+4%) and industry (+3%). On the other hand, agriculture registered a decrease of 1.2%.

And although the GDP grew by 0.2% in the final stretch of last year, household consumption actually decreased by 1.8% between October and December, registering its first quarterly decline since the beginning of 2021.

With regard to purchasing power, full-time jobs increased by 2% year-on-year, meaning that 386,000 of these positions were created by businesses in Spain last year.

Now read: House prices in Spain will see one of the biggest drops in Europe this year

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