Economy set to return to pre-pandemic levels before the end of the year

The Government estimates that the economy will return to pre-pandemic levels before the end of the year and keeps its growth forecast at 6.5 per cent.

Daily economic activity is expected to reach pre-pandemic levels by the end of the year. In the case of employment, the recovery will be earlier.

Economy Minister Nadia Calvino said the first quarter of 2022 will be the first with a higher level of economic activity than that recorded in the same period of 2019, and pointed out that “there is no precedent in Spain’s recent economic history for such a rapid recovery in activity and employment”, which she attributed to the different economic policy responses, on a national, European and global scale.

“Monetary and fiscal policy support has been key to this rapid exit, to avoid permanent damage, particularly in terms of job destruction, which would have led to a slower recovery and further damage to the productive and social fabric,” she said.

The growth forecast for 2021 and 2022 is maintained – 6.5 per cent and seven per cent, respectively – thanks to the drivers of consumption and investment in capital goods, which will increase by 16.5 per cent this year and 18.3 per cent next year. The foreign sector will continue to make a small positive contribution to GDP growth.

Regarding the upwards revision of the Organisation for Economic Co-operation and Development (OECD) forecasts for Spain to 6.8 per cent in 2021, the highest rate in Europe, Calvino added that it is important to remain prudent, given the uncertainty about the evolution of the pandemic at a global level and other geopolitical factors.

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Written by

Deirdre Tynan

Deirdre Tynan is an award-winning journalist who enjoys bringing the best in news reporting to Spain’s largest English-language newspaper, Euro Weekly News. She has previously worked at The Mirror, Ireland on Sunday and for news agencies, media outlets and international organisations in America, Europe and Asia. A huge fan of British politics and newspapers, Deirdre is equally fascinated by the political scene in Madrid and Sevilla. She moved to Spain in 2018 and is based in Jaen.


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