The Spanish economy has surprised with a better end of the year than expected, an acceleration in the last quarter that has placed the increase in GDP in 2023 at 2.5%, one tenth above the forecast maintained by the Spanish Government. The key to the surprise lies in the last three months of the year, in which economic activity has increased by 0.6%, two tenths more than in the previous quarter, when forecasts pointed more towards a moderation of Rhythm.
In this way, according to the data published yesterday by the National Institute of Statistics (INE), the year began with two first quarters in which there was a 0.5% growth, in the third there was a increase of 0.4%, and finally, in the last one, of 0.6%.
Therefore, the Spanish economy resists despite a turbulent international context and continues to behave much better than the euro zone, which stagnated in the fourth quarter. The data were also released yesterday and the conclusion is that the Eurozone avoids a technical recession, since in the previous three months it contracted by a tenth, but at the price of zero growth. In this last phase of the year, Spain and Portugal are the two countries that grow the most, while Germany contracts by three tenths.
What are the keys to the Spanish economy as a whole in 2023? Well, on the positive side, private consumption, which has contributed a total of 2.5% to growth, and on the negative side, investment, which continues to fall, despite the fact that European funds should play a stimulating role . “The bad part of this year, the worrisome, the negative, and which does not change direction in the fourth quarter, is the investment”, says María Jesús Fernández, from Funcas.
The strength of consumption is based on employment and wages, which have made it possible to maintain the purchasing power of households. This week’s EPA showed the creation of 783,000 new jobs last year, and wages have maintained purchasing power.
In the year as a whole, it should be noted that 0.8 points of growth is due to public consumption. It is an element that has contributed weight to growth but will have to loosen in a financial year like the current one in which the tax rules are back in force. On the other hand, external demand has also contributed 0.8 points to the increase in GDP in 2023 as a whole.
The truth is that the 0.6% growth in the last quarter has surprised everyone, but when you examine its composition, the conclusion is not so positive. There is an increase in the consumption of administrations of 1.4%, while that of households remains at a modest 0.3% and, in addition, another black point, there is a fall of 2% of the investment. Fall that links two consecutive quarters.
The Ministry of Economy highlights the positive evolution of exports based on the productivity of companies. These are data that, according to Minister Carlos Cuerpo, place Spain “in an advantageous starting point to meet our 2% growth target in 2024”. It also highlights that it is being demonstrated “that it is possible to combine economic growth, job creation and measures aimed at social protection and the well-being of citizens, households and businesses”.
In this way, Cuerpo maintains the forecast to grow by 2% this year, a percentage that is clearly above the forecasts of the various economic bodies, which until now had set it at around 1.5%.
