OECD raises its growth forecast for Spain to 2.1 percent this year

This international institution a quarter improvement Spanish GDP expectations compared to previous estimates released in March. It points to a trend similar to that predicted by the Bank of Spain, which recently spoke of a “over 2%” increase in GDP. The growth predicted by this international organization is even higher than recently estimated by the European Commission. The European Manager projects a 1.9% increase in Spanish GDP for 2023, according to its latest forecasts published in mid-May. The new OECD projection of 2.1% is in line with that formulated by the Government for this year.

2.1% of Spain Highest growth rate among the major countries of the European Union. It is clearly higher than Italy (1.2%) France (0.8%) and Germany (0%). The main economic power of the Old Continent remains the hardest hit by inflation and the war in Ukraine and will experience zero growth.

1.9% growth in 2024

“Given the difficult context of Russia’s war of aggression against Ukraine, the Spanish economy has resisted remarkably. While consumer confidence remains very low, business and consumer confidence has increased since the autumn,” the organization said in its report. In the section devoted to the Spanish economy. the labor market is dynamic and recorded a growth of 1.3 percent in the first quarter of 2023,” he adds.

OECD also improves growth forecasts for from Spain next year. Spanish GDP will grow by 1.9% in 2024, although it will continue its current slowing trend. Although this rate is below the European Commission’s estimate of 2%, it is two-tenths higher than previous estimates. On the other hand, the Spanish State had a 3.9% inflation. In other words, three-tenths less than the forecast three months ago and less than half of the 8.3% increase in prices in 2022. However, according to their forecast, this high 3.9 percent rate will be maintained over the next year.

slowdown in the eurozone

According to the OECD, “a number of factors that put negative pressure on the world economy have loosened”, such as inflation, the energy crisis or the restrictions imposed in China due to covid-19. All this contributes a little improved global growth forecasts. The planet’s GDP as a whole will grow by 2.7% this year, representing one-tenth more than the organism’s previous projections. A rate that will be lower than 3.3% last year.

One of the keys to this global growth is The revival of the Chinese economy. The Asian giant, second only to the United States in terms of GDP, will grow 5.4% after suffering a 3% loss last year marked by multiple restrictions of the ‘Zero Covid’ policy from Beijing. Instead of, american economy will suffer slowing down and Its GDP will barely increase by 1.6% this year and 1% in 2024. The eurozone will experience a similar dynamic this year, with a clear slowdown: the GDP of the 20 euro-using countries will only grow by 0.9%, but this rate will rise to 1.5% in 2024.

OECD warns: inflation “It will remain.” Despite the fall in energy and food prices, this rise in prices will now be driven by “a rise in services”, which are now generally “more constant than primary materials and more dependent on labor costs”. Given this situation, governments of OECD countries face the complex challenge of reducing inflation without undermining economic growth. “Leaders must promote policies that strengthen growth and make it more sustainable. This is difficult,” he warns in his report.