CaixaBank Research Valencia Community projects 1.9% GDP growth in 2023, this is above the 1.3% growth forecast for the Spanish economymaking this region one of the most dynamic in Spain.
The behavior of the Valencian economy is similar to that of the country as a whole. According to estimates by CaixaBank Research, Valencia GDP grew by 5.1% in 2022 (5.5% on average), primarily thanks to the revival in domestic tourism and the increase in consumption supported by the good labor market. Likewise, the economy has been affected less than expected by supply problems in international markets.
Business forecasts point to 1.9% GDP growth in 2023, slightly higher than that of the Spanish economy, making it one of the most dynamic regions. Although consumption and investment will be affected by high inflation and interest rate increases, the recovery in bottlenecks and the correction in energy prices will benefit industrial activities and exports.
Employment is improving better than the whole of SpainWith a 4.7% increase in affiliates in 2022 (vs. 3.9%). Growth slowed in January this year (2.3% versus 2.3%), but the number of affiliates was 9.0% higher than in January 2019 (+6.7% in Spain: construction and above all accommodation Employment) most dynamic activities. For its part, the unemployment rate stands at 13.5%, a figure 6-tenths above the Spanish average in 4Q 2022 but improving to records (14.1%) at the end of 2019.
The slowdown in consumption is more moderate than in Spain as a whole.. Thus, retail sales (by volume) stagnated in 2022, a figure that in any case improves Spain’s (–1.0%); As such, it is 2.3% below 2019 levels (-4.2% in the case of the Spanish average).
This industrial production presents a very similar evolution to the national group. After growing at the same rate as Spain by 2.4% in 2022, the region’s IPI is 3.3% higher than in 2019 (-0.4% nationwide).
Goods exports performed well in 2022, after modest growth in the previous year: they grew 23.0% year-on-year in the first 11 months of last year, only slightly below the national average (23.6%); In a generally positive atmosphere, semi-finished product sales and most importantly automobile sales came to the fore. As a result, Valencian exports are 25.7% above 2019 levels (+33.0% nationwide).
Although the region has a high concentration of tourism activity, it is less dependent on international tourism than Spain as a whole. In 2022, Spanish and foreign overnight stays in tourism establishments closed the year with an increase of 53.6% (+73.3% on the national average) compared to the previous year, while the difference from pre-pandemic levels was -3.4% (-4% in Spain, 7).