400,000 new jobs on the horizon for Spain

A leading Spanish economist expects big things from the economy over the next 12 months

Spain’s BBVA (Banco Bilbao Vizcaya Argentaria) – a multinational banking group based in the country’s Basque region – is confident that 400,000 Spanish jobs will be created between 2014 and 2015.

BBVA’s President, Francisco Gonzalez remarked this week that Spain’s growing GDP is likely to rise to at least two per cent in 2015, easing job creation and leading to a renewed rush of confidence in the Spanish economy…

Gonzalez also told delegates, gathered together for a seminar on the economic crisis in Europe by the Menendez Pelayo University in Madrid, that an additional 350,000 jobs could be created if current economic imbalances are corrected. If the government continues to carry out the kinds of successful labour reforms introduced to such good effect last year, GDP could even reach 2.5 per cent, said Gonzalez.

In May, Spanish jobless figures fell sharply, with fewer than 4.5 million Spaniards now registered as unemployed. Official forecasts from the government suggest that the unemployment rate could fall to under 25 per cent this year for the first time in three years, and could even drop to 23 per cent in 2015.

Amid the cautious optimism, the president of the European Commission (EC) this week blamed the Bank of Spain for making a series of significant errors of supervision that exacerbated the country’s banking crisis.

Jose Manuel Durao Barroso is coming to the end of his term at the helm of the EC, and has taken this opportunity to criticize the Bank of Spain for worsening the Spanish property crisis and subsequent slow economic recovery.

“We often asked about the situation of the banks because we’d heard that the banks and especially the savings banks were in bad shape, but the answer was that they were all in perfect shape,” said Barroso, who was told repeatedly that the Bank of Spain was “the best central bank in the world”.

“And yet it allowed the growth of private debt, the problems in the housing market, and that entire bubble,” he added. “And was that the responsibility of the European Central Bank, the International Monetary Fund or Angela Merkel? Those were very important supervision errors. And we need to take that on board.”