Activity in Spain holds up better than in the rest of the euro zone. If in 2018 the Spanish GDP grew 2.5%, in the Eurozone it advanced 1.8%. This is: a difference in favor of the Spanish economy of 7 tenths. This year the forecast for the monetary union is 1.1%, according to the latest forecasts of the ECB. As for Spain, the Funcas panel, composed of 18 institutions, kept its estimate for this year at 2.2% last Thursday. Which means that in 2019 the national economy could raise the growth gap with the average of the euro zone to 1.1 tenths. This Monday, with the figures known so far, the Bank of Spain confirmed this trend.
For the consensus of economists, the foundations of growth are good as long as foreign surpluses continue to be recorded and, therefore, the external debt continues to decline, an authentic Achilles heel that leaves the Spanish economy very vulnerable to the turbulence of the markets. "The central scenario is a mild deceleration of Spain. If there is a strong slowdown, it will be because it comes from outside, "explains María Jesús Fernández, an analyst at Funcas.
For now, the origin of global braking is located in China, where activity is expected to grow at the slowest rate in three decades due to commercial tensions with the US, the exhaustion of investment and the excess of debt. Uncertainty about Brexit and the crisis in Turkey also hurt European exports. In turn, the slowdown in global trade has had a direct impact on industry, which has also been aggravated by the difficulties of the automotive sector, which suffers from the problems of adapting to new environmental standards and the doubts generated around it. to the future of diesel. All this greatly affects Germany. But somewhat less to Spain, which resists better by the strength of domestic demand.
After several years of recovery from the debt crisis, the horizon that was drawn for the euro zone was a progressive slowdown towards what would be a more normal growth given the current demography and the small increases in productivity. Only that some factors that are considered temporary have sharpened this process. Not only for the motor industry. Also the protests of the yellow vests in France or the break that the Italians self-inflicted when raising a fiscal burden to Brussels that has resulted in a risk premium triggered, a collapse of the investment and, ultimately, the entry into recession technique. This Monday, the ECB Vice President, Luis de Guindos, explained in Madrid that these factors that slow down growth will take longer to soften than expected.
"The fear of an imminent global recession that the markets discounted in December has been diluted and now it seems that they are betting on a deceleration to rates of potential growth. In Europe, the profile of the cycle will depend on the evolution of international trade and its effects on industrial production, "says José Ramón Díez Guijarro, an economist at Bankia.
Public expenditure and brick
In this context, Spain at the moment seems to detach itself from the European trend. But why this? Between October and December 2018, the Spanish GDP added 0.7% quarterly compared to 0.2% registered in the Eurozone. Of these seven tenths of Spain, almost one third corresponded to a greater public consumption without counting the investments, which grow in the electoral period by 14%. By relaxing the goal of public deficit, the Government has been able to raise spending. The data do not take into account the improvement of the income provided by the increases in pensions and salaries of civil servants. According to an observatory of Fedea and BBVA, the fiscal impulse has injected some eight-tenths of an interannual GDP.
For the economist José Carlos Díez, part of the Spanish decoupling lies in the recovery of construction, which prevented Spain from suffering the slowdown of 2000 and is now avoiding it. Although from levels quite lower than those of the bubble, one in four jobs created in the last year were in this sector. Once discounted inflation, real interest rates are negative. What promotes real estate investment and helps families to the extent that mortgages are mostly at variable interest rates.
Another reason lies in the continued recovery of employment, which in turn pushes consumption. However, household spending grows more than any analyst would think. And that is attributed to the fact that the savings rate is at historic lows and consumer credit has skyrocketed. For the second year in a row, in 2018 families spent more than they earn. Although their debt does not get fat because they pull the savings generated during the crisis.
In any case, the Spanish differentiation can not last forever. "If the deceleration continues and deepens in the euro zone, Spain would end up suffering. Therefore, it is important to prepare for what may come, "said the governor of the Bank of Spain, Pablo Hernández de Cos, to EL PAÍS.
With regard to 2019, employment will shoot slightly less in Spain. But for Ignacio de la Torre, Arcano economist, the witness will take the wages as long as they rise below the euro zone and there is a certain moderation in the price of oil, which affects Spanish inflation more. For Fedea and BBVA, these increases, however, will end up draining competitiveness and, therefore, growth, as they are not linked to improvements in productivity.