Spain – 2021-2022 Scenario: persistent uncertainties in 2021
- Focus 1: first structural effects of the crisis
- Recent economic trends
- Outline of our scenario
- Focus 2: 2021 budget
Spanish GDP rebounded 16.7% quarter-on-quarter in Q3 (after -17.8% in Q2) but is still down 8.7% year-on-year. Our scenario remains cloaked in uncertainty, primarily due to doubts about the course of the pandemic. Our growth forecasts are -12% in 2020 and 3% in 2021. The low growth in 2021 is due to a negative overhang caused by the Q4 decline. In 2022 the rebound is expected to be 5.9%, which would leave Spanish GDP 4% below its 2019 levels.
Our scenario remains cloaked in uncertainty, primarily due to doubts about the course of the pandemic. The news regarding the development of various vaccines has reduced that uncertainty, although the challenge posed by production and distribution to the general populace remains. Although the last quarter of 2020 will be characterised by negative growth (-4.8% in our forecasts), the continuation of many economic activities during the “soft” lockdown will nonetheless help reduce its impact on growth. The first-half-year rebound will be more modest due to the longer-lasting social distancing measures and voluntary restrictions of movement, but the gradual modification of consumption and sales habits in retail are also expected to allow stakeholders to adapt more quickly.Ticiano BRUNELLO, Economist