The Spanish Gross Domestic Product (GDP) will grow to 6.5% during 2021 and will remain at 7% in 2022, according to BBVA Research forecasts. BBVA’s department of research and economic analysis has revised upwards by one percentage point the growth of the Spanish economy this year compared to the previous forecasts of the entity, which gives 5.5% growth in 2021.
The entity points out the reforms as a key aspect when it comes to enshrining this growth this year and next. Similarly, he expects European funds to leverage in the medium term, that is, towards 2022.
Continuity to your forecasts
In the previous report, BBVA already warned that if Covid infections continued to be limited and progress was made in the vaccination plans envisaged by the Government, “the bias of these forecasts could be upward . “
According to BBVA Research, the data for the second quarter of 2021 point to a return to growth (between 2.3% and 3.3% quarterly) . In addition, he explained that the end of the state of alarm, the advance in vaccination and the relaxation of restrictions have allowed an advance in the growth of private consumption.
BBVA Research expects, in the short term, upward growth as long as the disease is kept under control.
On the other hand, he has pointed out that, in the medium term, speaking of the growth of the Spanish economy in 2022, which could reach 7%, the bias will depend on the reforms implemented in the coming months and on the speed and efficiency of the execution of European funds Next Generation EU .
Doménech has pointed out that the reasons behind this review are that GDP fell in the first quarter of 2021, but less than expected and that, although domestic demand ended up falling as expected by the study service, although the behavior of net exports reduced this fall.
Activity and savings
One of the aspects highlighted by BBVA Research is the rise in world economic activity . He estimates that the international environment will remain favorable due to the advance of vaccination and demand policies. In fact, he considers that the positive trend, together with the fiscal expansion measures, especially in the United States, but also in the Eurozone, should support the growth of sales of goods and services worldwide.
In addition, he stressed that the savings are significant and could boost consumption . According to the entity’s study service, forced savings would have increased by 144,000 million euros between the fourth quarter of 2019 and the first of 2021. To which should be added the resources saved for precautionary reasons (23,000 million) to reach a accumulated bag of 68,000 million.
Along these lines, they point out that if the savings stock is assimilated as an increase in household income, consumption could grow, on average, between 1.1% and 2% in 2021 and 2022 , respectively. If the disease is controlled, the biases in the forecasts will be upward.
“The strong growth that has been observed in private spending could be higher than initially thought,” they establish from BBVA Research, which believes that the recovery of foreign tourism will be “key”, despite the fact that the national recovery will be slower than our neighbors.
Consumption could increase an average of 1.5% more in 2021 and 2022 compared to the scenario in which it is maintained as financial wealth. During the pandemic, 144,000 million euros have been forcibly saved. Part of these resources have already begun to be used and it is estimated that if households perceive this saving as deferred income during these two years, it will affect growth.