The Diplomat
The Minister of Foreign Affairs, José Manuel Albares, participated yesterday in Paris in the first day of the Ministerial Meeting of the Council of the Organization for Economic Cooperation and Development (OECD), which coincided with the publication of the half-yearly report of this organization and with the improvement of the outlook for the Spanish economy.
In addition to participating in the inaugural session of the Ministerial Meeting, held at the headquarters of this organization in Paris, Albares took part in the session dedicated to the conflict in Ukraine and held a meeting with the OECD Secretary General, Mathias Cormann, to whom he reiterated Spain’s commitment “to economic and social welfare” and with whom he commented on “the solid policies being implemented by the Spanish Government and which are favoring economic growth and a drop in inflation in our country,” as the minister reported on his Twitter account. “OECD forecasts announce that Spain will grow more than twice as much as the euro zone” and that “inflation will continue to fall,” he assured in another message. “The government’s policies ensure growth and welfare,” he added.
The OECD presented yesterday its Semiannual Outlook Report, which revises upwards its forecasts for Spain’s GDP expansion for 2023 and 2024 and assures that the Spanish economy will grow this year and the next above the average estimated for the Eurozone, thanks, among other factors, to the “considerable public spending” that our country will experience in these two exercises through the Recovery, Transformation and Resilience Plan (RTRP), financed with European funds.
Specifically, the document forecasts a growth of 2.1% this year (four tenths above its previous estimates of March 2023 and eight tenths more than in those of November last year) and 1.9% in the next (two tenths more than in the previous OECD forecast, very close to the European Commission’s calculations, which are 2%, and significantly lower than the 2.4% estimated by the Government).
The latest forecasts of the European Commission for 2023, published in mid-May, were for an increase of 1.9% in gross domestic product (GDP), while those of Pedro Sánchez’s own Government, presented last April in the Stability Program sent to Brussels, coincide with those of the OECD, 2.1%.
The OECD figures for Spain exceed all the major developed economies, such as the United States (1.6%), South Korea (1.5%), Japan (1.3%), Canada (1.4%) and Australia (1.8%). In the case of Europe, they are also better than those of Italy (1.2%), France (0.8%), the United Kingdom (0.3%) and Germany, all of them more affected than Spain by the boom in energy prices caused by Russia’s war against Ukraine. In the OECD as a whole, only four countries will outperform Spain this year, according to the report: Greece (2.2%), Portugal (2.5%), Costa Rica (2.8%) and Israel (2.9%). “In the face of a challenging environment in the context of Russia’s war of aggression against Ukraine, the Spanish economy has performed remarkably well,” the report notes.
However, the OECD is concerned about the evolution of “underlying inflation”, which does not include energy and food, and warns that the current year-on-year inflation of 2.9% cannot be maintained and that an average inflation of 3.9% is forecast for this year (slightly lower than the 5.4% estimated for the Eurozone) and one tenth above the Eurozone average of 3.7% in 2024.
After learning of the report, the President of the Government, Pedro Sánchez, stated on his official Twitter account that the OECD “once again improves the growth forecast for our economy”. “Spain will be one of the countries that will grow the most in 2023, more than double that of the euro zone. In addition, inflation will continue to fall. The Best Spain is the one that grows and creates jobs”, he added.
