Spain did not recover even half of the GDP lost in the pandemic in 2021

Terrace in a bar in the center of Madrid during the pandemic. / RC

The INE revises the growth of the economy in 2021 upwards, to 5.5%, but notes a drop of up to 11.3% in the first year of the coronavirus

Jose Maria Waiter

The definitive revision of the data of the Spanish economy has thrown a lime and a sand to the GDP (Gross Domestic Product) of the two years of the pandemic. In 2021, growth was finally higher than estimated, increasing by 5.5% compared to the 5% originally calculated. However, in 2020, GDP plummeted 11.3%, and not 10.8% as previously believed. In this way, last year Spain did not even manage to recover half of the ground lost in the first year of the coronavirus, weighed down by the restrictions that decisively affected the economy.

The Preview of the Annual National Accounting prepared by the INE (National Institute of Statistics) has produced these figures in which it admits significant variations with respect to the data initially published. The agency clarifies that the upward revision of the 2021 data is explained by "the incorporation of the results of the 2021 Family Budget Survey", published in June of this year. As for those of 2020, it is explained by counting for the first time the structural economic surveys referring to that year. Since the pandemic began, the INE has recognized the complexity of defining all the data it publishes related to GDP (and other indicators, such as the CPI) at first, due to the problems in capturing all these statistics in such a variable environment.

What the INE indicates is that the greater growth of the economy last year is due to a greater contribution from national demand (5.2% compared to the initial 4.7%), that is, from household consumption; and to a lower contribution from external demand (0.3%, compared to 0.5%). For its part, the growth of public administration spending was 2.9%, two tenths less than initially calculated.

With regard to external demand, the increase in the volume of exports stood at 14.4%, compared to the 14.7% estimated in March, while for imports it stood at 13.9%, the same figure as in the previous estimate.

With these definitive data on the table, the Spanish economy may not recover all the ground lost in the year of the coronavirus until, at least, 2024. For this exercise, the Bank of Spain estimates a growth of 4.1%, plus another 2, 8% in 2023 and 2.6% in 2024. Adding all these references, it would be in two years when the Spanish GDP returns to the original state it had at the beginning of 2020.

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