spanish economy

The number of foreign tourists visiting Catalonia continues to increase year after year. On Wednesday, the Spanish Ministry of Industry, Energy and Tourism released the figures for foreigners visiting Spain between January and June 2015. 7,439,211 international visitors came to Catalonia in that period, the highest number ever and a 4.4% increase on the figures from the previous year (when 7.1 million foreigners came). In addition, Catalonia also led the destination ranking within Spain, attracting 25.5% of all 29.2 million international tourists visiting the country during the first six months of the year (a 4.2% increase on 2014 figures). In the month of June, 1.71 million foreign visitors came to Catalonia, a 1.8% increase compared to last year and representing 25.6% of all international tourists travelling to Spain in that month.

This May, Catalan exports increased by 4.5% on the same period in 2014, reaching €5,301.7 million and setting a new record as the best May since 2000 (when comparable data started to be collected), according to figures published on Thursday by the Spanish Ministry for the Economy and Competitiveness. Imports also rose, by 2.7% to €6,331.2 million. The chemical industry accounted for €1,433.9 million, increasing by 7.1%, followed by the car industry, represented €882.5 million and a 6% growth. In contrast, exports in capital goods fell by 7.1% (€892.8 million). In the whole of Spain, exports increased by 1.9%, totalling €21,025 million and breaking a new record for a month of May since the beginning of the historical series in 1971.

The Brussels-based Centre for European Policy Studies (CEPS) and Barcelona-based Centre for International Affairs (CIDOB) think tanks, together with an Italian and a Greek research centre, have presented a report stating that the economy of an independent Catalonia would grow more in the next 15 years than if the current 'status quo' was kept. The study analyses 3 different scenarios: the current model, an agreed independence process and a unilateral declaration of independence. In either case of independence, the Catalan economy would be in better shape in the long-run than if the current framework was kept, the researchers conclude. However, in the event of a unilateral process, there may be negative economic effects in the short-term, mostly due to uncertainties related to EU Membership. Nonetheless, they consider the current inter-territorial fiscal scheme – imposed by the Spanish Government – "unsustainable at macroeconomic level" for Catalonia.

Prices increased by three-tenths during June and left an annual inflation of 0.3%, the highest in Catalonia in the last year, particularly since June 2014, according to data published Tuesday by the Spanish Institute of Statistics (INE). This data marks the second consecutive month with positive inflation in Catalonia after six consecutive months of recording negative rates. Spain as a whole also entered this June with positive inflation (+0.1%) after 11 months straight of deflation. June 2015 is the first month since June 2014 with positive annual inflation in both Catalonia and Spain as a whole, signifying economic recovery. Prices for electricity – which increased this June after falling last year – and the upward trend in prices of fresh fruit have decisively solidified recent inflation.

Catalonia's GDP has increased by 1.1% during the first quarter of the year compared to the last quarter of 2014, while the Spanish economy grew by 0.9% and that of the European Union by 0.5%, according to definitive figures released by the Catalan Statistics Instituted (Idescat) on Friday. In annual terms, Catalonia's economy increased by 2.6% from March 2014 to March 2015, mostly due to the positive evolution of domestic demand and the strength of the export sector. The figures released this Friday improve upon the provisional data that had been announced in May for the first term of 2015, when it was stated that Catalonia’s economy had grown by 0.9% from January to March. With the 1.1% growth finally registered, Catalonia now accumulates 8 consecutive terms of quarterly growth.

In times of economic crisis, the Mariano Rajoy-led Spanish Government has been making recentralisation a main driver of its political agenda, using the economic recovery as the reason for passing the reforms. An additional step in this direction was taken on Monday with a new regulation forcing Spanish Autonomous Communities to seek permission from the Spanish Ministry of Finance before granting loans and guarantees to private companies located in their territories. From now on, Madrid's permission will be conditional upon the applicant's compliance with deficit targets. The new regulation substantially curbs the Autonomies' powers to shape their industrial policies, following a reform passed in May that modifies both the Organic Law for Financing the Autonomous Communities and the Organic Law on Budgetary Stability and Financial Sustainability.

The International Monetary Fund (IMF) has reviewed and improved its economic growth forecasts for Spain, going from a 2.5% growth rate for 2015 forecast in April to a 3.1% one foreseen this June, and from 2% to 2.5% for 2016. However, the IMF has also issued recommendations and warnings, emphasising that Spain will have to carry out "additional fiscal efforts" and "structural reforms" in order not to jeopardise the country’s economic recovery. The IMF recommends that Spain reduce the costs of public healthcare and education by making users pay for part of the services. According to the international organisation, Autonomous Community governments – such as Catalonia's – should have greater fiscal responsibilities in such systems since they exclusively manage them. In this vein, the IMF has praised the fiscal consolidation efforts undertaken over the past few years by regional governments and has asked for an increase in their funding and fiscal powers, as well as for the adapting of the deficit targets to their needs.

Last month Catalonia was where the most intense monthly and annual drops in unemployment were registered in Spain. At the end of May, 531,899 people were on the Catalan Public Employment Service's (SOC) lists. This means 21,075 fewer jobseekers than in April 2015 (-3.81%), representing the most significant monthly drop registered for the month of May for 19 years (when the historical record started). Catalonia also registered a 10.2% annual drop in unemployment in comparison to May 2014 - representing 60,405 fewer people unemployed - the biggest annual decline since May 2000. It is has now accumulated 23 consecutive months of annual decline. In Spain as a whole, at the end of May 2015, the number of people registered as unemployed stood at 4.21 million, with 117,985 less jobseekers than in April 2015. An encouraging sign given that in the last 7 years registered unemployment had been falling at an average of 58,000 people from April to May.

The number of mortgages on homes in Catalonia increased by 35.1% in March compared to figures from March 2014, data from the Spanish Statistics Institute (INE) show, with a total 3,229 mortgages approved. This yearly increase strengthens an uninterrupted trend of 11 consecutive months of annual growth, following 44 months of uninterrupted decline. In Spain as a whole, a 19.71% annual increase in March on figures from March 2014 was registered and 19,806 mortgages on houses and flats were granted. These figures represent the 10^th consecutive month of annual growth at Spanish level. In all the Catalan Provinces, an annual increase was also recorded: Lleida came top with a 76% increase, followed by Barcelona (35%), Tarragona (28%) and Girona (22%).

Catalan exports totalled €15.66 billion for the period January-March 2015, a 6.6% growth on figures from the 1^st quarter of 2014. This represents a new historic high, setting a new record for Catalonia’s export sector, which has been growing strongly over the last few years. As well as this, exports in March increased by 15.4%, reaching the highest amount ever recorded for a single month. Exports from Catalonia during the first quarter of 2015 represent 25.7% of Spain’s total exports. Regarding Catalonia’s imports, they totalled €18.48 billion, a 4.4% increase. Catalonia’s trade deficit reached €2.82 billion, representing a 6.3% drop on figures from the previous quarter.

House sales in Catalonia have recorded a double-digit growth rate in March compared to the same period last year, official data from the Spanish Statistics Institute (INE) has highlighted. The number of house sales was 4,334 units, which represents a 10.2% annual increase over March 2014 figures. So far, Catalonia has accumulated six consecutive months of positive annual rates for house sales, and all its provinces have followed this trend with the exception of Tarragona. In particular, Barcelona Province stands out with an above-the-average 15.66% annual increase. In Spain as a whole, the number of houses sold in March was 27,280 units, a 2.1% increase in annual terms and the 7^th consecutive month of positive annual rates.

The Catalan economy has now accumulated 8 consecutive quarters of economic growth, posting a 0.9% increase in GDP between January and March, according to provisional data released on Thursday by the Catalan Finance Ministry and the Catalan Statistics Institute (Idescat). Regarding inter-annual figures, the Catalan economy had grown by 2.4% by the end of the first quarter of 2015 compared to figures from the same period in 2014. These last figures confirm a strengthening of inter-annual growth, since last December it reached 1.9%, and an overall strengthening of the Catalan economy and its recovery from the crisis of the last years. The recovery of the internal demand and the continuing good performance of the export and tourism sectors are the main engines behind the positive figures from the first quarter of 2015. In addition, the industrial sector has been growing for the last 3 years and construction has started to grow again after almost 7 years of continuous decline.

Official data released on Tuesday by the Spanish Employment Ministry show that both Catalonia and Spain as a whole registered the largest monthly decline in unemployment for a month of April since 1996. In particular, Catalonia closed last month with 552,974 people registered on the Catalan Public Employment Service's list, which means 18,681 fewer jobseekers in comparison with March 2015, a 3.27% drop. In annual terms, registered unemployment in Catalonia fell by 9.62% (58,848 fewer people), which is the highest percentage decline since May 2000. These figures mean that registered unemployment in Catalonia has fallen for 22 consecutive months. In Spain as a whole, at the end of April 2015 the number of people registered as unemployed stood at 4,333,016, which means 118,923 fewer jobseekers than in March, representing a 2.67%. In annual terms, registered unemployment in Spain dropped by 7.5%, as 351,285 fewer people were registered as looking for a job.

Barcelona's Chamber of Commerce has predicted that the Catalan economy will grow by 2.7% in 2015 and 3% in 2016. The latest estimates made by the Chamber in February foresaw a growth of 2.5% in the Catalan GDP for this year. The President of the Chamber of Commerce, Miquel Valls, said that this growth "has a lot to do with the surprising recovery of domestic demand, driven by job creation, and increased confidence in the economy." Valls also said that the depreciation of the euro and oil prices are factors that have contributed to the rise in GDP. Besides, the Spanish economy is expected to grow by 2.5% in 2015 according to the IMF or by 2.8% or 2.9% according to the Bank of Spain and the Spanish Government respectively.

The number of mortgages on homes in Catalonia registered a 32.4% increase in February compared to the same figure from February 2014. This annual increase strengthens an uninterrupted trend of 10 consecutive months of annual growth. This figure is particularly important taking into account that the crash of the construction and real estate sectors, as well as the lack of bank loans, were some of the main elements of the double economic crisis that affected Catalonia and the rest of Spain between 2008 and 2014. The recovery of the mortgage market is yet another indicator of a broader recovery of the real estate market and the overall economy, although its effects on some aspects of people's lives will still need time to be noticed, such as in the reduction of the high levels of unemployment.