Spain’s Alicante region looks for steady growth in 2024
Alicante’s economy is projected to grow at a moderate pace in the coming year. In 2023 the province ended with robust activity and a notable rise in GDP at current prices, surpassing the national average by several points. While growth remains uneven across sectors, expectations point to improved momentum as energy prices stabilize, global supply chains begin to unwind gradually, and National and European modernization funds begin to channel into local projects.
A panoramic report from Alicante, prepared under the renewal of a cooperation agreement between the Chamber of Alicante and Caixabank, outlines the path ahead. The document reflects leadership input from Carlos Baño, head of the chamber, and Xicu, regional manager of the financial asset, and reaffirms the collaborative approach to fostering regional development.
The report highlights that headline inflation is likely to ease over the year, yet food prices and core inflation could stay high. Elevated inflation and tighter bank lending conditions are expected to dampen private consumption, with employment growth slowing as a result. Financing constraints and a softer investment outlook in 2023 will be counterbalanced by improvements in the factors that limit economic activity and by the effective execution of projects tied to European funds.
The housing market may face continued pressure due to high construction costs, labor shortages, and structural factors. Slower demand and higher borrowing costs are expected to temper home price gains. On the trade side, foreign shipments could slow temporarily, but a decline in bottlenecks and a gradual rise in global demand should lift exports over the medium term.
BBVA foresees a 1 percent rise in the Community’s GDP for the upcoming year, while caution is noted that tourism could moderate the overall pace. Tourism often serves as a key growth engine, yet slower growth in main export markets and higher inflation impacting travelers’ spending power could limit its pull.
Looking back at last year, estimates for Alicante’s GDP at current prices show a strong expansion. The Synthetic Indicator of the Economic Activity of the Province of Alicante (IspA) recorded a 14.9 percent increase in 2023, comfortably above the national average by several points. Employment also advanced, driven by robust activity within Social Security affiliates, which rose by more than 25,000 workers compared to 2021 and by about 44,000 since 2019.