The International Monetary Fund (IMF) lowered its forecast for global economic growth in 2015. Global growth is projected at 3.5 percent for 2015 and 3.7 percent for 2016 in its latest World Economic Outlook report, lowering its forecast by 0.3 percentage points for both years.
Of the opposite form, IMF raised its growth forecast for just two nations – Spain and the United States. It predicts Spain’s economy will expand by 2.0 percent this year, in line with the Spanish government’s forecast, up from the 1.7 percent growth it projected in October. The IMF left its 2016 forecast of growth unchanged at 1.8 percent.
«There has been a substantial improvement in competitiveness, due both to an increase in productivity and to a decrease in wages. So, exports in Spain are doing well. That’s helping,» IMF Chief Economist Olivier Blanchard said after the report was released.
Spain, the eurozone’s fourth-largest economy, was plunged into chaos in 2008 when the global financial crisis hastened a correction that was already under way in its once-buoyant property sector. The country has since 2012 introduced major reforms of its labour laws which make it easier for employers to lay off workers or reduce wages which has greatly improved its competitiveness».
Consumer spending also increased last year as Spaniards became more optimistic about the economy with retail sales up over Christmas. These two factors have the effect of increasing growth, generating to virtuous circle, which is more confidence in the future leads to more investment, more consumption.
Regarding unemployment, real handicap of the Spanish economy, The Government expect Spain’s unemployment rate to ease to 24.2% this year and to 22.2% in 2015. Currently at 24.47%, Spain’s unemployment rate is the second highest in the euro zone after bailed-out Greece.
The recovery of the Spanish economy is strengthening, with higher growth than the countries in the single currency zone, and it allows to be very optimistic on the economic progress of the business of the country.
Jordi Pardines Blanes
INTERNATIONAL DPT. GALAN CONSULTORES
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