This is the first state of the nation debate under the mandate of Pedro Sánchez after seven years without being held.
During his speech, Santiago Abascal reproaches Sánchez for saying that Spain has increased its dependence on Russian gas four times. In the month of June, 24% of the natural gas imports that Spain has received came from Russia, via methane tankers, as a result of the formalization of the contracts committed in recent months. Although the average for the year is 8%, practically the same as in the same period of 2021, according to Enagás
President Sánchez stated during his response to Santiago Abascal that 43% of the contracts signed by young people were indefinite last June, compared to 7.4% in the same month of 2019. However, SEPE data details that they were 35%. In total, those under 25 years of age signed 195,692 contracts in the month of June, of which 50,634 were permanent, 34.9%.
The spokeswoman for the popular party, Cuca Gamarra, has reproached the Government that the improvement in the public deficit comes more through collection than through an adjustment of “unproductive spending”, ensuring that most of the collection increase has come this year by VAT, a tax linked to the evolution of citizens’ consumption. According to budget execution data from the Tax Agency, between January and May total income grew by 19.1% (16.2% in like-for-like terms). An increase that is explained by three elements: the 21.4% increase in VAT revenue; that of job withholdings (13.4%) and, lastly, the lower amount of the refunds made in the Corporation Tax that correspond to the annual declarations of 2020. These three elements explain more than 16 points of the increase in total income.
Youth unemployment was 36% in 2018 and today it is 30%
Pedro Sánchez, during the reply to the PP spokesperson, made more reference to employment data than in his first speech. Thus, he argued that youth unemployment has dropped from 36% in 2018, when his term began, to the current 30%, a statement that is true with respect to those under 25 years of age. Similarly, it is also true that in 2018 there were 8.7 million affiliated women and now there are 9.5 million. Finally, he boasted that the minimum wage has gone from 735 euros in 2018 to the current 1,000 euros.
“The countries with the lowest wholesale price”
Sánchez has pointed out in his response to the PP that Spain is “one of the countries with the lowest wholesale price” of electricity. The Iberian cap, applied for a month now, has meant an average saving of 15% in Spain with respect to the wholesale price that the rest of the European partners are paying, where this mechanism is not activated. However, the price of electricity has continued to skyrocket in the last month as a result of the increase in the cost of gas on the international market, which has led to a rise in electricity costs that have basically prevented electricity from reflecting a drop in last month compared to the prices registered until June 15, when the limitation on gas authorized by Brussels was activated.
“The INE methodology is going to change to modify the GDP”
During her speech, Cuca Gamarra stated that Pedro Sánchez “is going to change the INE’s methodology to modify the GDP.” The Ministry of Economy wants to incorporate new calculation variables to adjust the GDP or the CPI, although any change is supervised by Eurostat and it is the same methodology in all countries, where changes are also being incorporated.
Spain, the country with the most unemployment in Europe
Cuca Gamarra has denounced that Spain is the country with the most unemployment in Europe. And it is true. Until 2020 it was Greece, but with the pandemic Spain ousted the Hellenic country. Currently, the Spanish unemployment rate stands at 13.1%, not only the highest in the environment, but also double the community average, which stands at 6.1%.
“Inflation was already at 6.5% in 2021”
Cuca Gamarra recalls that “inflation was already at 6.5% in 2021.” The year-on-year inflation figure for December was 6.5%, but the average for 2021 was slightly above 3%.
president’s speech
The minimum wage has risen 40% in the last decade
“We have a minimum wage that is 40% higher than ten years ago,” said Sánchez. And, paradoxically, it is false, because the minimum wage has risen 55.9% since 2012, 16 points more than what the president claims. Thus, ten years ago the lowest salary in Spain was 641.4 euros per month (in 14 payments), while this year it rose to 1,000 euros, which represents an increase of 358 euros.
Record of indefinite: 8 out of 10 wage earners
It is quite surprising that employment, which is precisely the economic variable that is doing best, has played practically no role in this debate on the state of the nation. Pedro Sánchez has hardly taken off the good data on the labor market. Only he has referred to the record of indefinite contracts that has been achieved thanks to the labor reform, which has allowed almost eight out of ten wage earners to already have a stable job. This is true: June has become the month with the most indefinite contracts of all time, which has allowed something unprecedented: that the percentage of workers with an indefinite contract is already close to 80%, which is nine points higher than the average registered in this month in the last seven years.
Sánchez explained that European funds are already having a “very positive” impact on the Spanish economy. But the lack of transparency in the actual execution data complicates the calculation of that impact, which the Prime Minister has not detailed either. Airef itself, the body that oversees public accounts, recently lowered its forecast for the impact of the funds for this year from 2.5% of GDP to 1.8%. An adjustment that is associated with a lower multiplier of resources and, therefore, of their ability to boost activity. Specifically, Airef cut that ‘multiplier effect’ from 1.2 points to 0.9 for this year, after a 2021 in which “it was practically nil”, contributing just 0.1 points to growth.
Spain will close 2022 with an average inflation of 6.5%
Inflation, logically, has been the great protagonist of the state on the inflation debate. And the president, albeit with some caution, has dared to predict that prices will close the year with an average rise of 6.5%. This is a more than optimistic scenario, since the Bank of Spain forecasts an average inflation in 2022 of 7.2%, similar to the 7.1% estimated by the General Council of Economists, while the OECD raises it to 8 ,1%.
Eight countries with higher inflation than Spain
The President of the Government, Pedro Sánchez, has indicated that there are eight countries in the euro zone that register higher inflation than Spain, which dismissed May at 8.7% and climbed to 10.2% in June. According to the latest Eurostat data, of the 19 countries that make up the euro zone, Luxembourg (10.3%), Belgium (10.5%), Slovenia (10.8%), Greece (12%), Slovakia (12 .5%), Latvia (19%), Lithuania (20.5%) and Estonia (22%) exceed the Spanish figure. The average in the euro zone stood at 8.6%.
«Russia and Ukraine have come to provide a third of the world’s wheat»
Pedro Sánchez: «Russia and Ukraine have come to provide a third of the world’s wheat, 20% of the corn and 80% of the sunflower oil». It is true that the two countries at war provide a third of the wheat to the rest of the world, specifically 34.1%. However, the other two data are a bit inflated, since the two states provide 72.7% of sunflower oil worldwide, not 80% as the president has said, and 17.4% of wheat, compared to the 20% that Sánchez speaks of.
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