A heavy blow from Brussels to Spain’s growth, which will only rebound by 1% in 2023
The European Commission released its economic forecast for this fall and it is not good for the government. Specifically, Brussels expects it Spain will grow only 1% in 2023. In other words, half of what the government has subsidized in public budgets that are processed in the House of Representatives (2.1%). In this way, the European authorities join the reductions in the forecasts of other international organizations such as the OECD (1.5%), Airef (1.5%), the Bank of Spain (1.4%) and the International Monetary Fund (1.2%).
All of the above contradicts 4.5% recovery expected for this year. Here the commission increased by half a point than it had planned for Spain (4%). Either way, Spain will be above the eurozone average, which will be 3.2% on average in 2022 and 0.3% on average next year. By 2024, Brussels has indicated that the country will regain strength and will grow by 2% compared to 1.5% in the eurozone. However, Spain will not return to its pre-Covid-19 GDP level for another two years.
on me inflationBrussels indicated that this year in Spain it will end at 8.5% and will continue to decline over the next few years to 4.8% in 2023 and 2.3% in 2024. inabilityAfter the recent approval of new fiscal rules that will take effect in 2024, the European Commission expects that in 2022 this will be 4.6%, just below the 5% that the government projected in the overall picture of PGE . After that, the deficit will stand at 4.3% in 2023 and 3.6% in 2024. For its part, with regard to the Spanish public debt, it will close this year at 114% to drop very slightly to 112.5% next year and 112.1% in 2024.
Slight decrease in unemployment
In terms of employment, Brussels is less optimistic than the government and believes that in the next two years (2022 and 2023) The unemployment rate will remain practically unchanged at 12.7%.. At the PGE, the Executive has committed to closing the year of the Spanish Presidency of the European Union (EU) with an unemployment rate of 12.2%. In 2024, this variable will move barely a tenth to 12.6%. Despite the above, Spain remains among the countries with the largest drop in the unemployment rate, which will go from 13.3% to 12.7%, along with Lithuania, Sweden and Italy.
As for the European Union as a whole, Brussels raised its growth forecast to 3%, compared to the 2.7% forecast last summer. However, it lowered the estimate for 2023 from 1.5% to 0.5%.