“The best [la mejor, en inglés]” economy of the world, despite having been “long despised by its northern neighbors”. ‘The Economist’ has chosen Spain as the ‘number one’ economy of 2024 among the most developed, those that are part of the OECD.
Our country tops the ranking of the British financial weekly, one of the most influential in the world, according to a scoring system that combines five indicators: GDP growth, inflation, stock market, unemployment and budget imbalances (deficit).
This classification places Spain ahead of Ireland and Denmark, the second and third best economy in 2024 for ‘The Economist’, and also our main partners Germany (23rd), France (26th) and Italy (5th), or the United States (20th).
“The rebound in the Mediterranean continues for the third consecutive year, with Spain in the lead,” highlights the financial medium, in the information on the ranking published this Wednesday. “Greece and Italy, once emblematic of the euro zone’s problems, continue their strong recovery. Ireland, which has attracted many technology companies, and Denmark, home of Novo Nordisk, famous for Ozempic, round out the top five,” he continues. “Meanwhile, the heavyweights of northern Europe [Alemania, principalmente] They disappoint,” he adds.
In our country, ‘The Economist’ highlights that “annual GDP growth is on track to exceed 3%, driven by a strong labor market and high levels of immigration, which mechanically increase activity.”
Precisely regarding unemployment, he recognizes that Spain still “suffers high unemployment”, but also emphasizes that “it has fallen to its lowest level in more than a decade.”
Good forecasts from the OECD
Recently, the OECD raised our country’s economic growth by two tenths to 3% this year and another one to 2.3% in 2025, despite the blow of DANA and despite the weakness of the eurozone, whose GDP will advance as a whole by 0.8% and 1.3%, respectively, especially due to the stagnation of Germany.
The projections exercise of the international institution closes the price crisis that has been suffered since 2021. According to OECD economists, inflation in Spain will remain at 2.8% on average in 2024, and will moderate to 2.1% next year. This ‘disinflation’ will be one of the drivers of economic growth by easing the ‘pocket’ of families.
That is, salaries are going to give more of themselves, one of the reasons why “private consumption” is expected to increase by 2.7% in 2024 and 2.4% in 2025, along with the strength of the market labor and “greater household savings.” The creation of jobs will reduce unemployment from 11.5% this year to 10.9% next year, and also increases the number of people working in each home, improving the income they have each month.
Furthermore, “the investment will be recovered supported by lower financing costs [por las bajadas de los tipos de interés del BCE] and the implementation of the Recovery, Transformation and Resilience Plan,” says the OECD.
The other boost to growth is the foreign sector, and is supported by tourism, exports of other services [de consultoría, ingeniería, o relacionados con la tecnología, el gran cambio estructural de nuestra economía] and lower dependence on energy imports, as listed in the projections report of the international institution.
With these projections, the OECD accepts Spain’s fiscal plan – in compliance with EU commitments – to reduce the deficit (the imbalance between public expenditure and revenue) to 2.5% in 2025 and to 2.5%. 1% in 2026, with an ‘adjustment’ or ‘consolidation’ of the Budgets of 12,000 million in the coming years.
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