Spain’s GDP is expected to expand faster than the rest of the EU

Spain's GDP is expected to expand faster than the rest of the EU. Image: Twitter

Spain’s GDP is expected to expand faster than the rest of the EU.

The speed of the Spanish economy will pick up in the second half as the vaccination process is extended and European funds arrive. Brussels has increased its outlook for this year’s growth to 5.9 percent, up three-tenths from February. The European Commission estimates that EU aid will improve Spain’s economy by 6.8 percent next year, up from the 5.3 percent it had predicted previously.

The European Union, which fell into recession in the first quarter of this year, is regaining confidence. Finally, the vaccination rate has surpassed that of the United States and the United Kingdom. And although its economy is still lagging behind Washington and Beijing, it finally believes it can get back on its feet thanks to the massive aid it will start sending to other EU menbers in the summer, which is estimated to have an impact equivalent to 1.2% of GDP by the end of 2022.
By lifting restrictions, receiving 34.75 billion euros in European funds between this year and next year, and implementing the compromised reforms, Spain, which plummeted by 10.8 percent in 2020, will lead the euro area’s rise. Brussels is also hastening the time that Spain’s Gross Domestic Product (GDP) will rebound prior to the pandemic’s onset. It will do so at the end of 2022, not 2023, as previous projections predicted.
When it comes to determining if the European Union will suspend fiscal rules next year, the date when countries return to pre-crisis levels is crucial. The Commission has recommended this, but some countries, including Germany, have requested that the Commission’s prospects be examined first before making a decision. Despite the fact that the German economy pulled the eurozone into recession as a whole, Brussels expects that by the end of this year, it will have recovered its pre-crisis level of activity. Nonetheless, Economy Commissioner Paolo Gentiloni has cautioned that the EU will not be able to return to its pre-crisis growth trajectory. We must avoid mistakes that could undermine it, in particular a premature withdrawal of support for the economy,”
As reported by El Pais
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Written by

Natasha Brewer

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