Future for Spanish Economy looks happier

THE Spanish economy appears to be recovering at long last. It grew at its fastest rate since 2007 in the second quarter of this year and there are signs that this growth (even if not at the same level) is sustainable.
Since mid-2013 the economy has been stronger thanks to a rise in consumer spending, competitive prices, and a huge increase in tourist visitors thanks in part to the weak euro and an ongoing drop in the very high unemployment rate.
“We’re starting to see the light at the end of the tunnel,” Economy Minister Luis de Guindos told Onda Cero radio after the release of recent data showing a quarterly growth rate of one per cent. “We are now able to return to pre-crisis income levels.”
The government is obviously hopeful that this recovery will continue as it would help its chances of winning in the elections due by the end of the year. But it does face a major task to persuade voters that the turnaround is reaching everyone.
Although low inflation has helped to put more money into some people´s pockets, Spain still has over 20% unemployment, second only to Greece within the euro zone.
Whilst the International Monetary Fund expects Spain’s economy to grow by around three per cent percent this year, high levels of government and company debt tend to inhibit an investment revival that could herald a more balanced recovery. Despite this, 2015 could see Spain having the fastest growth rate in the euro zone.
Many large Spanish companies have taken the opportunity during the years of recession to expand their business internationally and this foresight could well help to buoy up their businesses as a weak home market could be offset by strong overseas markets.
A little known British politician announced to hoots of laughter that she had seen the first shoots of growth in the UK economy some years ago, but perhaps it is safer to forecast the same now in Spain.