• Health. Coronavirus in Spain, live
  • Coronavirus. The Government foresees a moratorium on quotas for self-employed and SMEs of up to six months

The Spanish economy faces the coronavirus crisis with a major debt and deficit problem, a point that has already been underlined on more than one occasion by the Bank of Spain and that this Tuesday has been confirmed by the National Statistics Institute (INE): the deviation Budget in 2019, far from being contained, rebounded beyond 33,000 million euros.

"In the whole of the year 2019, the Public Administrations presented a financing need of 33,223 million (2.7% of GDP), compared to 30,495 million (2.5% of GDP) in 2018 ", indicates the INE in the accounts quarterly published today.

Along with these data, Statistics has also detailed the National Accounts figures confirming that: the Gross Domestic Product (GDP) registered a growth of 0.9% in the fourth quarter of 2019; that year-on-year growth stood at 1.8%, compared to 1.9% in the previous quarter; And that, as it had already anticipated, in 2019 the economy registered a growth of 2% .

All these figures, of course, will be aggravated by the paralysis of the economy and the enormous expenditure that the Government is going to incur is trying to minimize the consequences of this unprecedented situation. But what they draw is a previous scenario that is not precisely the ideal one to face this impact, especially in the case of the deficit .

First rebound since 2012

The Government of Pedro Sánchez and, specifically, the Minister of Finance, María Jesús Montero, have always shown their commitment to budgetary stability. However, the data released today by the INE denies that statement, since they indicate that they indicate that, for the first time since 2012, the deficit was not corrected .

In addition, 2.7% is very far from any of the successive objectives that the Executive has been communicated. The latter reflected a figure of 2%, for which a reduction of 0.5% of GDP would have been necessary, but in light of these data not only has there been no improvement but the Government incurred an increase of 0 ,two%.

The reprimand of the Bank of Spain

For this reason, and also for what happened in previous years, the Bank of Spain and the governor of the body, Pablo Hernández de Cos, have warned on several occasions in recent days that the years of strong growth were not used to strengthen the economy before a possible shock . " The expansionary phase was not used to build a budget buffer that would have allowed us to face the current health crisis from a more solid position ," the BdE reported in its latest quarterly report.

And precisely the Bank of Spain, and also this Tuesday, has published that the debt of all the administrations rebounded by 16,000 million over the past year, reaching 1,189 trillion euros . In terms of GDP, the data fell from 97.6% to 95.5%, which is the lowest figure since 2012.

According to the criteria of The Trust Project

Know more

  • Coronavirus
  • Covid 19
  • economy