In Spain

Body Blow To Spain’s Automobile Sector : Nissan Closes Its Barcelona Plant, Destroying Nearly 25,000 Jobs

The automotive sector was already in a difficult situation before COVID-19. The Spanish market is not escaping this crisis and has already seen its first victim with the announcement of the Nissan plants’ closure in Barcelona. The closure, which is expected to take place in December, will cut around 3,000 direct jobs at the plant and an additional 20,000 indirect jobs. The sector represents 10% of Spanish GDP and the three Catalan factories produce 1 in 5 vehicles assembled in Spain. 

The Spanish Economy Has Entered Deflation After The Health Crisis

Link Securities | According to preliminary data from the Spanish National Institute of Statistics (INE), the Consumer Price Index (CPI) fell to -1% year-on-year in May (-0.7% in April). The drop reflected the decline in fuel and oil prices, while food prices continued to rise. May inflation has not seen a decline to -1% since 2016. We do not rule out that the entire Eurozone could end up heading into deflation over the coming months, at least those economies most penalized by the pandemic.

The Spanish Export Sector’s Deterioration Due To The Health Crisis Is In Line With The Eurozone: A Fall Of Around 3%

Bankia Estudios | As expected, the improvement in the external sector observed in the first two months of the year did not continue in March. The Covid-19 crisis hit both exports and imports hard, with setbacks of more than 14% year-on-year: only trade in chemical products, mainly medicines, and food was exempt from the contraction. The Q1’20 accumulated drop in Spanish exports (3%) is similar to the one noted in the EMU (3.2%) and Germany (3.3%), but much lower than that in France (8.6%). 


Spain's tourism things to improve

Spanish Domestic Tourism To See A Revival End-June; Beginning July For Foreigner Visitors

Today Spain is taking another step towards the “new normal” with Madrid, which is the country’s economic driver, Barcelona and Castilla y León, the areas most affected by the pandemic, moving into Phase 1. The remaining 29 provinces, plus the autonomous cities of Ceuta and Melilla, are now entering Phase 2. Furthermore, the tourism season is expected to start at end-June for the Spanish population and at the beginning of July for foreigner visitors. The tourism industry accounts for over 12% of Spain’s GDP.

Spain’s Financing Needs Rise To €130 Bn In 2020; Well Off The €32.5 Bn Initially Planned For This Year

Intermoney | What is clear is that the finances of countries like Spain are only sustainable thanks to the ECB’s very important support. And also thanks to the EU’s action which is much better than in the previous crisis. If the German and French Recovery Plan, based on subsidies, is successful, Spain’s need for financing will be lower; in other words, Community transfers would help keep net financing well below the 130 billion euros target.

Spanish companies' cost of financing at minimum lows

Spain Has Already Approved The Use Of €84.5 Bn Of The Total €100 Bn Guarantees For Corporate Loans

Santander Credit Research | The Spanish government approved a fourth tranche (€20 billion) of the €100 billion worth of guarantees for corporate loans which was announced on 24th March. This is part of the economic aid package to mitigate the negative impact of the containment measures imposed due to the Covid-19 outbreak. The new tranche approved will be aimed entirely at guaranteeing loans to small and medium sized enterprises (SMEs) and the self-employed.

The challenge for Spanish banks in 2019: improve profit margins, still at historic lows

Public Debt Will Be A Headache For The Spanish Economy: It Is Already Close To 100%

According to data released yesterday by the Bank of Spain, overall government debt reached 1.224, 243 trillion euros in March. It increased by 22.473 billion euros (+1.9%) from February due to the Covid-19 crisis. So public debt is now at an all-time high and equivalent to 98.3% of 2019 GDP. All organisations highlight in their forecasts that public debt will rise above 100% and set new historical records.

The Return Of The Franco-German Axis Marks The Recovery Plan For EU Member States

The Franco-German axis is back in operation thanks to the coronavirus crisis. Yesterday, the French president and the German chancellor agreed to propose the creation of a €500 Bn reconstruction fund to the European Union (EU), far cry from the quite regularly speculated sum of around €1 Bn or €1.5 Bn. The proposal is very much in line with the recovery plan which the European executive is working on currently and is expected to be presented on 27 May.

Unidas Podemos Proposes A Tax On Large Fortunes In Spain

Bankinter | Unidas Podemos, the party which forms the government coalition in Spain together with the socialists, has proposed the introduction of a progressive tax to replace the Wealth Tax. In the tax calculations, a person’s primary residence would be exempt up to an amount of 400.000 euros. For the time being, this is only a proposal that will be taken to the Commission for Economic and Social Reconstruction in Congress for debate.