Eduardo González
The Gross Domestic Product (GDP) of the euro zone fell by 0.1% in the third quarter of the year in the euro zone compared to the previous quarter, while it increased by 0.1% in the EU as a whole, as revealed by the data from Eurostat, the statistical office of the European Union, published yesterday. Spain is among the few countries that have grown in this period, with 0.3%.
According to Eurostat’s preliminary estimate, the euro zone recorded a contraction of 0.1% between July and September 2023 compared to the previous three months, in which there was an increase of 0.2%. This is the first drop in quarterly GDP since the second quarter of 2020, in the midst of the COVID-19 pandemic.
Among the main causes of this decline is the situation of the EU’s economic locomotive, Germany, which has entered into recession. Taking into account that, in economics, the fall in GDP in two consecutive quarters is considered a technical recession, the euro zone is just one quarter away from falling into recession, something that, with current inflation and interest rates and with the very complicated geopolitical environment, it is very likely to happen.
According to Eurostat, among the Member States for which data is available for the third quarter of 2023, the greatest advance corresponded to Latvia (+0.6%), followed by Belgium (+0.5%) and Spain (+ 0.3%), while the largest decreases were recorded in Ireland (-1.8%), Austria (-0.6%) and Czechia (-0.3%). Italy and France have stagnated and Spain, despite growing above the rest, is also beginning to show a slowdown. In fact, Spanish GDP for the third quarter is lower than 0.4% in the second and 0.6% in the first quarter of 2023.
On the other hand, compared to the same period in 2022, Eurostat shows, in the third quarter of 2023, a growth of 0.1% in both the euro area and the EU, after +0.5% in the euro zone and +0.4% in the EU from the previous quarter. By country, the growth rates compared to the same quarter of 2022 were positive in Portugal (+1.9%), Spain (+1.8%) and Belgium (+1.5%), while the largest decreases were recorded in Ireland (-4.7%), Estonia (-2.5%), Austria and Sweden (-1.2% both).
“In a complex international context, Spain leads the economic growth of the main economies in Europe in the third quarter, with a year-on-year growth of 1.8%, above the 0.1% of the European average,” the Ministry of Economic Affairs declared yesterday through its official account on the social network X. This data, according to the Department led by Acting Vice President Nadia Calviño, is “a reflection of the strength and resilience of consumption, investment and employment.”
