THE Covid-19 crisis has pushed Spain’s holiday islands Mallorca, Ibiza, Menorca and Formentera towards a recession, the CAEB Balearic Business Association Confederation says.
The latest CAEB report concludes the Balearic economy shrank by 4.5 per cent in the first quarter of the year due to the halt in business activity under lockdown, as well as economic uncertainty at the beginning of the year.
The confederation described the archipelago’s economic decline as unprecedented, highlighting the fact the services sector had been particularly hard hit.
It also predicted worse for the second quarter.
CAEB president Carmen Planas pointed out the Balearics are now facing a “completely atypical tourism season,” and one which is “full of uncertainties.”
She said the confederation therefore appealed to regional entities to follow polices to “mitigate the negative impact in the short-term, and in parallel, lay the groundwork for the reorientation of the destination in the face of the permanent changes anticipated.”
Planas also expressed the view that the maintenance of ERTE temporary suspensions of job contracts should be dependent on the existence of a coronavirus vaccine.
“While we do not have a vaccine we are risk and the ERTEs have to continue being a necessary tool so our companies do not go under and to protect employment,” she said.