Sunday, March 3, 2024

Spain’s economy will grow by 1.6% in 2024, despite geopolitical uncertainty

The General College of Economists has predicted an increase of 1.6% for Spain in 2024. The entity, which this Monday presented the report of the Financial Observatory and Economic Keys corresponding to the third quarter of 2023, warns, however, about the situation of global geopolitics, which will mark the evolution of the country. In addition, they raised their inflation projection this year by a tenth, to 3.2%. This estimate is subject to events in the Red Sea that cause an increase in the cost of energy and raw materials.

The closing figure for 2023, which was 2.5%, caused economists to raise their forecasts for this year. They are also more pessimistic about the public deficit, which they believe will end the year at 3.4% of GDP, more than the 3% predicted by the government. This increase is mainly due to the fact that the 2023 income is not sustainable due to lower economic growth.

College experts are particularly concerned about the Consumer Confidence Index, which closed the year 2023 at 77.6 points, so it remains below the euro zone average (about 100 points). . Productivity, moreover, continues to be one of the main problems of the Spanish economy.

“We have to take into account the geopolitical environment, which may lead to more tensions that worsen the predictions, so we are at an important moment where we have to dedicate our time and effort to the area of ​​productivity, productivity investment and long-awaited control of the public deficit, if we want to consolidate the 2023 figures,” the president of the General Council of Economists, Valentín Pich, said in a press conference.

IBEX 35 and its development in 2023

In the presentation of the report, it is emphasized that 2023 will be a positive year in terms of equities, with an increase in the main stock indices. Last year, the IBEX 35 experienced an increase of 22.7%. “2023 is a positive year for all markets except oil. In the classification of stock markets, in the United States, the Nasdaq and the S&P 500. In Europe, it is worth highlighting the FTSE MIB40 in Italy and the IBEX 35,” said Montserrat Casanovas, one of the authors of the document.

Andalusia needs a lot of resources

The Minister of Economy, Finance, and European Funds of the Government of Andalusia, Carolina España, who was present at the event, asked for the reform of the regional financial system, an issue that he admitted will take time to accomplish, and suggested that it approve a fund of 3,000 million euros to help the autonomous communities such as Andalusia, the Valencian Community, the Region of Murcia, and Castilla-La Mancha.

He also emphasized that economic change “must go hand in hand with the business sector” to promote Andalusia as one of the main job destinations. “What we need to achieve is to attract foreign investment and provide more facilities by reducing bureaucracy because we want to continue to be a magnet for investors,” he said.

World Nation News Desk
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