Doubts about Spain’s public accounts overshadowed a major meeting of foreign investors

Spain faces 2023 with much better economic prospects than its main neighbors in the eurozone and with relative calm in the knowledge that it The large European economy is less exposed To the vicissitudes of the war in Ukraine. But it carries a very high public debt and the endemic imbalance in its public accounts seems to be a source of uncertainty in a context in which higher interest rates and the reduction of the accumulated balance between the financial crisis and the pandemic by the European Central Bank may lead. It caused some turmoil in the capital markets.

This, in general, is the diagnosis made by the expert committee that on Wednesday analyzed the future awaiting the Spanish economy, within the framework of the Spanish Investors Day. For better or for worse, a message has the added value of being launched into a forum it was designed for Selling Spain to foreign investment And in front of an audience of dozens of businessmen, investors and brokers.

The fact that more than half a dozen senior government officials will parade throughout today and tomorrow, including the Prime Minister, Pedro Sanchez, who will be in charge of closing the event on Thursday; First Vice President Nadia Calvino and Third Vice President Teresa Ribera; and Industry Minister Reyes Maroto.

The audience that gathered on Wednesday had the opportunity to see firsthand the confidence of analysts in the strength of the Spanish economy, its thriving foreign sector and the financial stability of the private sector, which is a differentiator compared to what happened. during the financial crisis. but also Doubts arising from its high indebtedness And the lack of strictness of its successive administrations when closing its public accounts, which were suffering from permanent deficiencies.

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Chief Economist, Deloitte Spain, Anna AguilarHe did not hesitate to point to the development of public finances as the main challenge facing the government in this fiscal year. “We are in a context in which the European Central Bank is committed to reducing the balance accumulated in recent years,” he explained. Frederick BrettThe chief economist of BNP Paribas warned that “more indebted countries will be more exposed if this movement causes fluctuations in the capital markets”, stressing in any case the greater relative strength of the Spanish economy compared to other European countries.

On the same wavelength, the CEO of Equipo Economico, Ricardo Martinez Rico, expect Spain to grow by 2% in 2023, mainly due to the strength of the private sector. More skepticism is generated by the action of the public sector. He warned, “We are at a time when fiscal policy must be accompanied by monetary policy, and this means reducing labor costs and reducing financial costs, which is the opposite of what is happening in Spain.”

to Raymond Torresdirector of macroeconomics and international analysis at Funcas, said the government’s priority this year should be to design a credible fiscal consolidation plan “not only to send a signal of commitment to public account sustainability to markets and investors but also to insure against turmoil that may eventually emerge in the capital markets.” .

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