Spain enjoys improved economic outlook

Spain’s renewed economic confidence is reflected in a number of Spain-China trade deals on the table

Job prospects, wages and employment security are all set to improve in Spain next year, according to the country’s Finance Minister Luis de Guindos who last week raised Spain’s economic outlook…

The minister has revealed that Spain is on course to post growth of 1.3 per cent this year, a slight increase on April’s forecast of 1.2 per cent. Next year, that figure should top two per cent, making Spain one of the best-performing economies in the Eurozone.

Renewed confidence in Spain’s economic recovery has gathered pace in recent months. In April, the tentative figures were presented as a ‘best case scenario’, and have been exceeded. This time last year, sceptics were warning that Spain would struggle to top 0.7 per cent growth in 2014 – when in fact Spain will post double that growth.

Economic growth means more jobs, and de Guindos is confident that Spain will raise its job creation total from 580,000 this year to more than 620,000 in 2015. If realised, this will bring unemployment to below 22 per cent by the end of next year. Current unemployment in Spain stands at 24.5 per cent.

Although Spain’s jobless rate remains among the highest in the Eurozone, the economy is most certainly moving in the right direction, bucking an almost universal trend of contraction among most other Eurozone countries.

“We are seeing more confidence, more employment and investment,” said de Guindos. “We foresee two years of growth, gaining pace, balanced, with close to no inflation, an external surplus and lower private and external debt.”

One sector of Spain’s economy that has enjoyed a notable upturn in fortune is the construction industry, which is on course to make a positive contribution to the country’s economic growth for the first time since 2008 – the year the property bust hit.

Meanwhile, on an official state visit to China, Spanish Prime Minister Mariano Rajoy has told Chinese investors and businessmen that Spain’s economy is well on the way to recovery.

Rajoy is in China to schmooze with high-ranking decision-makers and help close trade deals that are close to completion, including a deal between Spanish retail giant Inditex and Chinese outlets, as well as deals in food, agriculture and online services.

“The economic situation in Spain is now diametrically opposed to the one we found ourselves in three years ago,” said Rajoy during his speech to business leaders. “Thanks to a definitive change in the direction of economic policy we have turned the situation around. Spain is growing, creating jobs, exporting, investing… and doing so in a sustained and sustainable way.”