Foreign Trade Saves The Spanish Economy

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In September 2021, Spanish exports grew by 21.9% year-on-year to 28.337 billion euros, a record for the last decade. The figure exceeds by 5 billion euros the peak in sales to the rest of the world recorded in September 2019. In turn, imports also show the highest figure since 2012, with a year-on-year increase of 24.2% to 30.730 billion euros. An increase that is not unrelated to the price of energy products and the economic recovery, although lower than expected. A very clear asymmetry between political bickering and the dynamism of the business world, not to mention the extent of vaccination.

The number of exporters with sales of more than 1,000 euros grew by 14.9% to 87,897, while regular exporters (those with a presence in the last three years and this current year) grew at a rate of 9%.

The international comparison of the figures reinforces the conviction of the competitiveness of the Spanish economy. Indeed, growth of 21.9% in September is double the rate of France and Italy and even higher than that recorded by Germany. The increase in imports also exceeds that recorded by the European Union, the United States and the United Kingdom, where foreign purchases have fallen by 10%.

In absolute figures, the difference between exports and imports in September resulted in a trade deficit of 2.396 billion euros. A year-on-year increase of 60.8%, but nevertheless much lower than that recorded in September 2018 and 2019. The main component of September’s deficit is the rise in hydrocarbon prices, as the non-energy deficit remains the same as in the same period last year.

Between January and September 2021, exports increased by 22.1% to 229.963 billion euros, which represents a new all-time high for the period, surpassing pre-pandemic figures. For their part, imports grew 21.9% year-on-year in 9M2021 to 243.230 billion, bringing the Spanish trade deficit to 13.267 billion at the end of the third quarter. However, the export-import coverage rate, at 94%, is the highest in the whole decade in those first 9 months of each year.

The geographical distribution of our exports to the EU and the Eurozone shows percentages of 61.7% and 54.4% of total sales, while the rate of progress towards these two areas grew by 24.4% and 25.1% respectively. France remains our number one customer, followed by Germany, which is weakening as a buyer, while sales to Italy and Portugal are growing strongly. Exports to the United Kingdom are maintained. Slightly more than double those sent to China during these nine months of 2021.

Energy products recorded an upturn due to higher prices; purchases of medicines also grew. However, the most important item of Spanish imports continues to be capital goods. This is a further indicator of the strength of our productive sector.

A surplus with the European Union of 18.856 billion euros and 20.668 million euros with the euro zone. On the other hand, the trade deficit with non-EU countries (hydrocarbon prices) increased to 32.123 billion euros. As for our trade with non-EU Europe, we recorded a surplus of 2.329 billion euros as a result of the surplus with the United Kingdom, which exceeds the deficit with the rest of the non-EU European countries.

Exports to China grew at a year-on-year rate of 16.5% between January-September, outpacing the 13% increase in purchases. However, the total figures are so disproportionate that the trade deficit with China in the first nine months of 2021 has risen to 17.8 billion euros, well above the total deficit with the rest of the world of 13.268 billion.

About the Author

Luis Alcaide
Luis Alcaide works as an economist for the Spanish government since 1961. He has been state adviser in the European Union and Bank of Spain director of communications. Alcaide published editorial articles in Spain's leading newspaper El País between 1977 and 1983, and in Diario 16 between 1985 and 1988. He regularly contributes to Economía Exterior and Política Exterior. He's founder member of Grupo Consejeros.