Spain – 2021-2022 Scenario: a still-disrupted start to the year
- Focus: household savings in the crisis
- Recent economic trends
- Outline of our scenario
After the sharp increase in GDP in Q3 (+17.1%), economic activity stagnated in Spain in the last quarter of 2020. Q4 growth was stable. At the start of the quarter, the worsening of the health crisis led to the tightening of measures to contain the pandemic. However, those measures were much more targeted than those taken in the spring, and were loosened again in the last few weeks of December. Combined with a process of economic agents learning and adapting to the pandemic, this made it possible for Spanish GDP to avoid contracting again in Q4, unlike its European partners.
We are projecting 3.7% consumption growth in 2021 and 3.9% in 2022, following negative growth in Q1, which will delay the recovery. Investment will also be hampered in the first half-year, but will benefit from the government’s stimulus plan, which projects 34% growth in public investment, according to the 2021 budget. The plan’s effects will manifest in the second part of 2021. The foreign sector will also not show signs of recovery until next 2021, depending on the progress of the vaccination campaign at the European level.Ticiano BRUNELLO, Economist