Spain

In 2008, amid the global financial and economic crisis, the fourth largest economy in the euro area entered a phase of recession, described by the OECD experts as “unprecedented†, both in intensity and duration. The GDP decline ceased only at the beginning of 2010. In 2012, the Spanish economy returned to recession and, despite the implementation of varied “recipes†against it, the Spanish authorities failed to find the right formula to relaunch growth. The budget deficit in 2012 was the highest among the EU member countries. According to the international experts’ prognoses, the Spanish economy will continue to contract in 2013, while for 2014 it is projected a modest growth, taking into account that the process of fiscal consolidation and the high indebtedness of the private sector “undermine†domestic demand. However, in contrast to the period 2010-2012, when the Government repeatedly resorted to austerity measures to prevent the collapse of public finances, now it is recognized the need for a gradual fiscal consolidation. Moreover, this stance is supported by the European Commission’s representatives. Net exports remain the only source of growth and the critical issue of the Spanish economy continues to be unemployment, with all its associated negative effects.