The Independent Authority for Fiscal Responsibility (AIReF) cut its 2024 growth forecast by three-tenths to 1.7%.An economic progress that would make it possible to reduce the deficit to 3% of GDP, as envisaged by the incumbent Government, provided that anti-inflation measures are withdrawn.
AIReF calculates: Public deficit will close around 4.1% of GDP in 2023The government’s budget plan is two tenths above forecast and Thinks it’s possible to drop 1.1 points in 2024 If the measures taken to alleviate the effects of the energy and price crisis are not expanded and regional governments control the expenditure increases.
The impact of anti-inflation measures is around 1 point of GDP (15,000 million euros) in 2023, as announced by AIReF president Cristina Herrero at a press conference this Thursday during the presentation of her report on the plan. budget. It will affect only one tenth of GDP in 2024To continue the urban public transportation support that was previously announced to be maintained.
According to the institution’s figures, 3% open target Next year this will be achieved with more revenue and more expenses than the Executive envisages.
AIReF makes some predictions Revenues increase by 6.5% in 2024 (equivalent to 42.7% of GDP) and some 4% higher expenses (equivalent to 45.7% of GDP) has been affected by the withdrawal of measures such as reducing VAT on some foods and reducing the electricity and gas bill. Specifically, this would mean 5,700 million more revenue and 8,000 million less spending.
AIReF also takes into account: It is possible to reduce public debtIt will increase to 106.3% of GDP in 2024, with a 5.3 percentage point cut. However, keep in mind that Spain is one of the euro countries with the highest debt levels, after Greece and Italy, and is similar to Portugal and France.
Herrero once again underlined the need. plan containing the medium-term orientation of public finances AIReF announced that it calculated that in a scenario with fixed policies, the deficit would rise to 3.2% of GDP in 2025 and remain constant at this rate until 2028.
Negative risks
AIReF approved the economic growth forecast of the budget plan, which predicts that the economy will grow by 2% in 2024, but also warned about downside risks. Continuing inflationary pressures Because of geopolitical tensions.
Your predictions: lower than the government’s Because in an environment where financing conditions are tightening and trust between households and companies is deteriorating, a lower growth in domestic demand, especially private consumption and housing investment, is predicted. It also revised the impact of the recovery plan downwards to 1.1 percentage points of GDP in 2023 and 1.9 percentage points of GDP in 2024.
For 2023, economic growth of 2.3% is forecast, with a significant weakening of the economy in the second half of the year; This will be worse than AIReF thought in the spring and will condition the following year. However, the authority predicts positive rates for both the third quarter (0.1%) and the fourth quarter (0.2%).