Worse to come for Spanish economy

PUBLISHED: January 26, 2013 at 9:30 am • LAST EDITED: February 9, 2013 at 9:49 am
Business & Finance, National News • 5 Comments

• Storm clouds continue to linger over Spain's economy

SPAIN’S economy is set to get worse this year, according to the International Monetary Fund (IMF).

GDP is expected to shrink by 1.5% in 2013, slightly more than the 1.4% contraction that was predicted in autumn last year.

The figure is in contrast to the IMF’s forecast for the global economy, which is predicted to grow by 3.5% this year.

However, the IMF’s World Economic Outlook gave a brighter summary for 2014, estimating that output in Spain will increase by 0.8%, against a global increase of 4.1%.

Spain’s government announced it expects output to fall by 0.5% this year, although experts claim the figure will be higher.

Spain slipped deeper into recession in the final quarter of the year due in part to a slowdown in consumer spending following the introduction of value-added tax in September.

“Household consumption posted negative figures throughout the year, though more forcefully so in the final month, owing to the impact of fiscal consolidation measures,” said a spokesman for Spain’s central bank.

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peter

January 26th, 2013 2:13 pm

Ah a new name for higher taxes “fiscal consolidation” I feel so much better.

Pamela

January 30th, 2013 6:08 pm

Where is the evidence it will get better in 2014?

peter

January 30th, 2013 7:34 pm

@ Pamela

Super Mario Draghi said so, all I see in my local area is shops and bars closing down. I am now taking my Spanish neighbours to our nearest big town for their monthly shop as their car is broken and they can’t afford repairs any more. The soaring Euro isn’t going to help them either.

luc

February 3rd, 2013 3:42 am

This is not a crisis, a crisis has a beginning and a end….
This is a complete movement of jobs from the west to the east,,,and these jobs are not coming back…it is the collapse of the western rich period…back to the middle ages.

Stephen Davis

February 13th, 2013 12:10 pm

As the great Winston Churchill once said:

“We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”

Look what happened to the Roman Empire; Ottoman Empire and now looking like the USA too. Huge capital controls, expansion of “The State” and gradual (sneaky) increase of taxation. All of which has wonderful names like “Fiscal Consolidation”!!

Are we forever doomed to repeat history!?

Only the greed, incompetence, corruption and immorality of politicians do this and not the “normal” people.

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