Grant Thornton’s cheery view on Spain’s crisis: changing perspectives

Auditor Grant Thornton in Spain has a message of optimism to deliver, which may soften investors' hardened capital allocation plans as much as recession-hit Spaniards. We at couldn't help it so there you have it, cartoons and laughs included.

Of course, the company's detailed analysis on the current travails of the Spanish economy and its outlook for the 2012 sounds somehow sombre in comparison.

“A eurozone recession, banking instability, government cuts and mass unemployment will severely test Spain over the next few years,” Grant Thornton experts say. “Exports are unlikely to be able to compensate for weak demand and a long, slow path back to growth is expected with very few positive signs at all in the next 24 months.”

“Although the latest round of bond auctions created more demand than anticipated, long-term bond yields remain well above 6% and the government is keen on a direct bailout of its banks without the need for national default. Key decisions by the European Union and European Commission as a whole will help clarify the situation over the coming weeks and months.”

They add: “It could take until around 2015 for growth to pick up but assuming reforms to the labour market and regional government are undertaken the domestic economy should be able to provide greater support to exports. However growth will be significantly slower than in the past decade.”


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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.