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flag Spain Spain: Economic and Political Outline

Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

Economic Indicators

Spain has achieved an economic leap in the last two decades and has risen to be amongst 20 of the world's most significant economies. It registered annual GDP growth rates higher than 4% between 1997 and 2000 and thereafter a growth rate that is always higher than the average in the Euro zone due to consumption and to the real-estate "boom". Nevertheless, the growth factors, which were at the root of its economic growth have been weakened by the financial crisis, which touched the real-estate sector and weakened the banking system. In 2009, the GDP growth fell by 3.7%, putting an end to 16 subsequent years of positive economic growth.

The government’s stimulus policies did not prevent a rise in unemployment, which increased to as high as 18% of the active population, the highest rate in the European Union in 2009. The labour market reform which came into operation in 2010 has nevertheless helped increase the productivity of the Spanish economy. Both the construction sector and to some extent consumption were hit by the economic crisis. Although inflation is showing a tendency towards stabilization, household consumption predictions remain bleak for 2011.

Many companies are in trouble or are closing down, especially in real-estate, construction and public works sectors. Outstanding debts of companies as well as families have increased by 12% in figures but by 61% in value.
In 2010, Spain turned towards a different economic model, freeing itself from real estate as its traditional growth factor and capitalizing on improved competitiveness and a higher added value on services. With an increase of 22.4% on its quarterly net profits, Spain’s number one bank Santander reflects the country’s ambition to resist the economic downturn. 

 
Main Indicators 2009201020112012 (e)2013 (e)
GDP (billions USD) 1,467.891,409.95e1,536.481,575.111,615.94
GDP (Constant Prices, Annual % Change) -3.7-0.10.81.11.8
GDP per Capita (USD) 32,03030,639e33,298e34,05134,859
General Government Balance (in % of GDP) -9.0-7.2e-4.4-4.1-3.8
General Government Gross Debt (in % of GDP) 53.360.167.4e70.272.8
Inflation Rate (%) -0.22.02.91.51.5
Unemployment Rate (% of the Labor Force) 18.020.120.719.718.5
Current Account (billions USD) -75.88-64.23-58.26-49.54-45.50
Current Account (in % of GDP) -5.2-4.6-3.8e-2.8-

Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

Agriculture contributes around 3% of the Spanish GDP. The country produces wheat, sugar beet, barley, tomatoes, olives, citrus fruits, grapes and cork. It is the world's largest producer of olive oil and the world's third largest producer of wine. It is the largest producer of lemons, oranges and strawberries. Spain has limited mineral resources.

The manufacturing industry is dominated by textiles, industrial food processing, iron and steel, naval machines and engineering. The new sectors such as relocation of the production of electronic components, information technology and telecommunications provide a high growth potential. In 2009, industrial production growth rate nevertheless fell by 10.2%.

Tourism represents Spain's largest source of income, having become the second tourist destination of the world and thereby stimulating export of goods and services. The tertiary sector contributes to 2/3 of the GDP.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 4.2 24.7 71.1
Value Added (in % of GDP) 2.6 26.1 71.3
Value Added (Annual % Change) 1.0 -10.3 -1.0

Source: World Bank - Last Available Data.

 
 
 
 
Learn more about Market Analysis about Spain on Globaltrade.net, the Directory for International Trade Services.
 

Indicator of Economic Freedom

Score:
70.2/100
Position:
Mostly free
World Rank:
31/179
Regional Rank:
18/42

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

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Foreign Trade in Figures

Foreign trade has little impact on the country’s GDP growth. The Spanish trade deficit worsened in 2009 and 2010. Although imports fell by half in 2009, exports too lacked vigor. The energy bill reached EUR 41.8 million, which is almost 15% of the total imports. Nevertheless, its burden decreased because of the drop in Brent future price and the increase in the production of renewable energy. Apart from food products (e.g.: fruits and vegetables) whose balance remains in surplus, there is a negative balance for other items, which shows that Spain is loosing its competitiveness.

The main trade partners are the countries of the European Union, France being the first destination of Spanish exports (19.2% in 2009). France imports Spanish food products, cars, chemical and textile products. Spain also has good trade relations with the Maghreb countries.

 
Foreign Trade Indicators 20062007200820092010
Imports of Goods (million USD) 328,696389,301420,804293,218312,228
Exports of Goods (million USD) 213,717253,297281,493227,338244,527
Imports of Services (million USD) 77,86095,688104,03686,67985,500
Exports of Services (million USD) 105,501126,747141,750121,517120,846
Imports of Goods and Services (Annual % Change) 10.28.0-5.3-17.8-
Exports of Goods and Services (Annual % Change) 5.15.3---
Imports of Goods and Services (in % of GDP) 32.733.632.225.5-
Exports of Goods and Services (in % of GDP) 26.326.926.523.4-
Trade Balance (million USD) -104,622-125,238-126,613-58,956-62,350
Trade Balance (Including Service) (million USD) -76,545-93,582-88,394-23,260-25,849
Foreign Trade (in % of GDP) 59.060.558.748.9-

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2010
France 18.3%
Germany 10.5%
Portugal 8.9%
Italy 8.8%
United Kingdom 6.2%
See More Countries 47.4%
Main Suppliers
(% of Imports)
2010
Germany 11.7%
France 10.7%
China 7.9%
Italy 7.0%
United Kingdom 4.5%
See More Countries 58.1%

Source: Comtrade, Last Available Data

 

Main Products

Main Exports
(% of Exports)
2010
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 10.6%
Parts and accessories for tractors, motor vehicles...Parts and accessories for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles of heading 8701 to 8705, n.e.s. 4.2%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 4.1%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 3.9%
Motor vehicles for the transport of goods, incl....Motor vehicles for the transport of goods, incl. chassis with engine and cab 1.9%
See More Products 75.4%
Main Imports
(% of Imports)
2010
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 9.5%
Parts and accessories for tractors, motor vehicles...Parts and accessories for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles of heading 8701 to 8705, n.e.s. 4.7%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 4.6%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 3.7%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 3.7%
See More Products 73.8%

Source: Comtrade, Last Available Data

 
See More Products
More imports (Intracen Data)
More exports (Intracen Data)
 

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Sources of General Economic Information

Ministries
Treasury Department
Ministry of Industry, Tourism and Commerce
Ministry of Environment, rural and marine environment
Statistical Office
National Statistical Institute
Central Bank
Bank of Spain
European Central Bank
Stock Exchange
Spanish stock markets
Search Engines
Yahoo Espana
Icex
Buscopio
Gomera
Hispa Vista
Hotbot Spain
Ozu.es
Sharelook.es
Sol
Telepolis
Terra
Wanadoo.es
Economic Portals
Invertia

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Political Outline

Executive Power
The King is the Head of the State and the commander-in-chief of the army; his role is mostly ceremonial. Following legislative elections, the leader of the majority party or the majority of the coalition is appointed Prime Minister by the Sovereign then elected by the parliament for a 4 year tenure. The Prime Minister is the head of the government. He is also called the President of the Government. He holds executive power which includes the execution of the law and the management of the routine affairs of the country. The Council of Ministers is appointed by the king on the recommendation of the Prime minister. There is also a Council ofState which enjoys the role of the supreme consulting body of the government. But its recommendations are not binding.

The President of each Autonomous Community is from the majority party of the majority coalition winning elections of the Parliaments of the Regions which take place every 4 years. the President forms a government whose «ministers» are appointed under the title «consejeros» and seconded by a cabinet and director generals, etc. who are in charge of each Department heading the sectors for which the Autonomous Community has jurisdiction in substitution of the Spanish State (single administration).

Legislative Power
The legislative power is bicameral. The Parliament, called Cortes Generales, is made up of:
- The Senate which has 264 seats. Its role is that of representing the territories (Autonomous Communities and Departments). The senators are elected by universal suffrage for 4 years.
- Congress of Deputies which has a minimum of 300 seats and a maximum of 400 (currently 350). The deputies are elected by universal suffrage for 4 years from departmental constituencies. There are alloted one minimum representation and the remaining is proportional to their population. To avoid splitting up which is harmful to the stability of the Chamber, the D’Hondt system is applied.
The executive wing of the government depends directly or indirectly on the parliament's support, often expressed by a vote of confidence. The legislative power belongs to the governement and the two houses of parliament at the same time. The Prime Minister does not have the authority to dissolve the parliament directly, but he can recommend its dissolution to the king. The Spanish citizens enjoy considerable political rights.
The 17 Autonomous Communities also have a legislative power exercised by their monocameral Parliament within the limit of jurisdictions fixed by each of their Statutes.
Main Political Parties
Although Spain has a multi-party system, there are above all two dominant parties. The regional parties can be powerful within the Autonomous Communities, which makes them essential to form coalition governments. The two most important parties of the country are: the PSOE (Spanish Workers Socialist Party), a democratic socialist party, and the second oldest party, and the PP (People's Party), which is the largest liberal conservative party of Spain. The other important parties are:
- The IU (United Left), a coalition of left parties around PCE (Spanish Communist Party);
- The CiU (Convergence and Union), a conservative and nationalist party based in Catalonia, which supports market economy;
- Le PNV (Basque Nationalist Party), a centre-right political party based in Basque Country.
Current Political Leaders
King: Juan Carlos I (since November 1975), heriditary.
President of the government and Prime Minister: Mariano RAJOY (since december 2011), PP.
Next Election Dates
Senate: March 2012
House of Deputies: November 2015
 

Indicator of Freedom of the Press

World Rank:
39/178
Evolution:
6 places up compared to 2009

Source: Worldwide Press Freedom Index 2010, Reporters Without Borders

 

Indicator of Political Freedom

Ranking:
Free
Political Freedom:
1/7
Civil Liberties:
1/7

Map of freedom 2010
Source: Freedom House

 

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Last Updates: January 2012