T.C. | The Spanish economy will grow by 6.4% in 2021, making it the fastest growing European country. It will also be one of the fastest growing globally amongst the advanced economies, along with the US, where growth is also estimated at 6.4%. This is according to the International Monetary Fund’s biannual ‘World Economic Outlook’ report published yesterday.
With respect to its previous forecast, the IMF has boosted the rise in Spain’s GDP by five tenths of a percentage point in 2021. For 2022, the forecast for Spain is that GDP will grow by 4.7%, almost one percentage point above the European Union (3.8%).
However, the revised estimates leave a bitter aftertaste. The IMF calculates that Spain will record an unemployment rate of 16.8% this year, the highest in Europe, two tenths of a percentage point higher than the Greek unemployment rate. And it forecases this will fall to 15.8% in 2022. According to the IMF, Spain will not recover its pre-pandemic unemployment rate until 2026, when it will register 14.4% (in 2019 it was 14.1%).
As far as the deficit is concerned, the IMF projects it will stand at 9% this year and fall to 5.76% in 2022. And as far as gross public debt goes, it flags that this will reach 118.35% of GDP and fall next year to 117.32%.
Andrea Schaechter, head of the IMF’s Spain mission, warned at the end of last year that the economy would not reach its pre-pandemic level until 2023.
With respect to the world as a whole, the IMF estimates the pandemic will push 95 million people into extreme poverty. That said, it has improved its previous forecasts for the global economy, with “growth of 6% in 2021 and 4.4% in 2022.” The multilateral agency justifies this rise by “improvements in advanced economies,” especially economic growth in the US, which is expected to expand 6.4% this year. The US becomes “the only major economy forecast to exceed its projected GDP level in 2022 in the absence of this pandemic.”