Services exports: it’s not just all about tourism

The provisional data for the Q2’16 balance of payments in Spain shows a surplus of 26 billion euros, which is a maximum level for the series. Namely Afi flags that the balance of services stood at 13.4 billion euros in Q2, up from 12.2 billion a year earlier. What is worth noting about this rise, apart from the amount, is that it is not just the result of the good performance from tourism-related activities (which represents 9.6 billion euros of the surplus recorded in Q2). It is also due to the positive trend in non-tourism services. The surplus from these services rose to 3.8 billion euros in Q2’16 from 3.2 billion in Q2’15.

In these terms, the growing protagonism of exports of non-tourism services represents one of the most significant structural changes in the Spanish economy since the 2008 crisis.

Afi provides two more figures related to this point. In the Q2’08, the annual balance of non-tourism services was hardly representative of the Spanish economy’s external sector. But in the last twelve months, it has contributed 13.7 billion euros, accounting for approximately 27% of the total services surplus.

Furthermore, non-tourism services alone currently compensate for 70% of the trade deficit balance. And their progress has been sustained since 2008 and there are no signs of this peaking.

By geographical areas, Spain’s non-tourism services are mainly exported to the euro area, which accounts for 38% of demand. Europe as a whole represents over 60%, America 23% and Asia 11%. By countries, the three main EU economies, Germany, France and the UK share 9% per capita.

By type of activity, corporate services represent almost a third of the total exports of non-tourism services, led by technical services related with engineering activities but also with trade (22%), professional consultancy and management services (9%) and R&D (2%).

Transport, maintenance and repair account for 29% of non-tourism services exports; telecommunications, computing and information 17%; and financial, insurance and pensions services 11%. Other assorted services, including those linked to construction, account for the remaining 10%.