March 6, 2021

The IMF lowers its forecast for Spain and demands more measures from Sánchez

The IMF lowers its forecast for Spain and demands more measures from Sánchez

The International Monetary Fund (IMF) has reduced by two tenths its forecast of growth of the Spanish economy for 2018, to 2.5%, and warns that if this year's budget is extended, the deficit could be diverted to 2%. , 4% of GDP in 2019.

"The Spanish economy continues to recover the lost ground during the crisis," the IMF acknowledges in the annual report on Spain released today, although it notes that it has already exceeded the peak of the cycle and that the growth rate will moderate to 2.5% this year, 2.2% in 2019 and thus progressively up to 1.75% in the medium term.

LThe forecast for 2018 is a tenth lower than the Government's forecast and according to the IMF it responds to the weakening of cyclical forces and a less favorable external environment.

Closing the gap between the productive capacities of the different autonomies would allow to raise the GDP by 1.4 additional points, for which it would be necessary to further adapt the training of workers to market demand and boost investment in research and development. This is stated by the International Monetary Fund (IMF) in the report in which it analyzed the reasons why productivity differs by up to 60% between some autonomous communities and others and as a whole is 10% lower than the German.

The text states that if the autonomous communities whose productivity is lower than the national average (eleven of them, with Castilla-La Mancha at the top) reach that level the Spanish GDP would grow 1.4% more, while if all will reach their maximum productive potential, the increase would be 4%.

The geographical disparity is such that, sAccording to IMF data, in 2016 the richest regions generated twice the income per capita than the poorest, while the employees of the most productive produced about 50% more than those of the poorest.

One of the reasons is the educational level, since close to 40% of the workforce has, at most, the first cycle of lower secondary, which is one of the highest percentages in the euro zone, only behind Portugal and Malta.

In addition, the geographic dispersion is very wide, with percentages that vary between 25% of the Basque Country and 50% of Extremadura, which in turn translates into a lack of connection between the skills of the workforce and the skills that claim the market.

This lack of connection is more acute in Extremadura, Castilla-La Mancha and Andalusia, and less in Madrid, the Basque Country and Asturias.

Thus, the IMF sees as fundamental the promotion of measures to reduce school drop-out rates and increase collaboration between the private sector and universities so that the labor market is more present in higher education, which would help reduce the percentage of people who can not find work due to lack of adequate training.

It also advises that the communities coordinate to copy among themselves the best practices and thus achieve that there is not so much regional disparity in educational results, and that they encourage more active policies so that the training of the unemployed people is more adjusted to the needs of the market. .

In this regard, the IMF points out that the Spanish focused on training spending is lower than in other European countries, although it is confident that the 2017-2020 Spanish Activation Strategy for Employment can improve this aspect.

Another weak point that the international organization observes is the scarce investment in research and development, which also differs a lot between communities, so that four of them invest more than all the others together.

Likewise, it observes that most of the communities use the available technologies inefficiently, so that only five of them exceed the national average of the patent ratio for money invested in R & D.

To solve it, it recommends greater coordination among the different administrative levels to, among other measures, design, implement and evaluate R & D policies that increase the efficiency of expenditure in this area.

As well advocates fostering cooperation between the scientific field and business to strengthen the Government's efforts to improve the innovative capacity of communities and improve the business environment, which would help communities attract foreign direct investment and thus accelerate their adoption of innovations from other countries.


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