April 15, 2021

The Agenda for Change: towards an inclusive and sustainable economy | Economy

The Agenda for Change: towards an inclusive and sustainable economy | Economy

In the last 20 years Spain has lived a complete economic cycle marked by the intense variation of production and employment: our economy grew a lot during the years of expansion, but also contracted exceptionally sharply during the crisis, which caused a process of destruction of employment and wealth whose impact has not yet been corrected.

In this period, our country has advanced a lot in some important aspects, such as per capita income -which has gone from 19,600 euros per person in 1998 to more than 25,000 euros in 2018-, physical or digital infrastructures, commercial opening and the rebalancing of the balance of payments. But it continues to present a disappointing result in other aspects that are equally or more relevant from the point of view of sustainability in the medium term, such as low productivity or the increase in social inequality, closely related to the labor market.

The Spanish economy has a remarkable capacity for job creation. In these last years of growth, the occupation figures prior to the crisis have practically recovered, but this time without a real estate bubble. However, little progress has been made in reducing the dysfunctions that have dragged on for decades: the high rate of temporary and involuntary part-time hiring, structural unemployment at unacceptably high levels and low wages. Precarity, poverty and inequality affect young people, with a very negative impact in terms of social exclusion and vital perspectives.

These challenges are compounded by the need to adapt our economy to the profound social and demographic transformations, as well as the challenges involved in the fight against climate change, digitalization, artificial intelligence and global value chains. The fourth industrial revolution is a fact.

They are not new challenges, but they are well known for a long time. As is the need to address structural reforms that allow Spain to improve its ability to grow in a balanced and inclusive manner, benefiting the population as a whole.

However, in recent years economic policy has been rather passive, trusting that markets, growth and job creation, on their own, would solve all our problems. Also in the fiscal area the management has been accommodative, trusting the good progress of the economy to reduce the deficit and without making any structural adjustment or adapting our tax system to the new realities. A short-term policy focused on the here and now, without putting the big lights to try to anticipate and take measures that allow our country to aspire to a better future.

As the president of the Government, Pedro Sánchez, recently said, the economy and politics are not an end in themselves, but must be at the service of the people. And for this it is necessary to advance as soon as possible towards a new paradigm, taking advantage of the good economic situation and all the assets available to Spain, which are many.

We grow robustly, above the economies of our environment, and all national and international organizations expect this trend to continue in the year that has just begun. We are, therefore, at a key moment to define what policies we want to make the flag and what country we want to be in a few years so that our citizens live better and with more security.

There is no time to waste and the uncertainties that surround us in the international arena should not lead us to paralysis, but, on the contrary, encourage us to act as soon as possible.

Therefore, the Agenda for Change that guides the Government's action contemplates a coherent set of measures to bet on training and education, promote the ecological transition, promote scientific and technological development, move towards a fairer labor market that contributes to reduce inequality and increase productivity, strengthen the welfare state and strengthen the social protection network through a tax system adapted to the new economic reality. Also progress towards a more efficient Administration at the service of citizenship.

It is a project of a country, with a proactive economic policy, that puts in value all the available resources to progress in a cohesive, fair and environmentally sustainable way.

They are proposals to take advantage of the current context and address the inherited imbalances, increase the growth potential, achieve a productive system with zero emissions and move towards a more egalitarian society with a structural unemployment rate aligned with the European average.

Economic history teaches us that we must live with cycles, and beyond short-term actions, think creatively and ambitiously in the opportunities offered by the future to lay the foundations of an exciting project that takes advantage of our many assets , and achieve a more balanced growth, more equal and more respectful with the environment.

Nadia Calviño is Minister of Economy and Business.


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