The INE raises GDP growth in the first quarter to 0.8%, the highest in almost two years
The Spanish economy started 2024 on the right foot. The final growth data in the first quarter published by the National Institute of Statistics (INE) this Tuesday confirms and even improves what had already been anticipated in April. The national GDP grew 0.8% at the start of the year, one tenth more than expected.
This figure places the growth recorded in the first quarter of the year as the highest in almost two years: We would have to go back to the second quarter of 2022, when GDP rose 2.4% to find better data. Of course, it must be taken into account that on that date the Spanish economy was still in the full recovery phase after having collapsed like no other in Europe due to the impact of the pandemic.
Now, the growth recorded has occurred with this complete recovery process for almost two years and in a context in which the large economies of the eurozone suffer stagnation that seems to be slowly beginning to dissipate.
Confirmation of the data underpins the wave of revisions in economic forecasts that have been seen in recent quarters. Organizations such as the IMF or the Bank of Spain foresee an increase in GDP that would be 2.3 and 2.5%, respectively, for the year as a whole.
This has led to The Executive himself announces that he will improve his growth estimates for this year in light of the latest data that has been published. The Minister of Economy, Carlos Body, announced on Monday that the figure that the Government now foresees will be closer to 2.5% than the 2% that is currently being handled. A relevant issue when preparing budgets, given that it allows a greater margin for public spending.
“We continue with the streak of good economic news,” said Body in a video released this Tuesday morning. A growth that has been based on three major factors, she has pointed out. Namely: investment, private consumption and the strength of the export sector. “The Spanish economy continues to grow at a faster rate than the main European economies and creating more and higher quality jobs,” the minister stressed.
Consumption falters, investment picks up, tourism declines
If each section of the national accounting is analyzed in more detail, it is observed how household consumption grew by 0.4% at the beginning of 2024. Something more than the previous quarter, but a modest figure if we compare it with other components of the GDP. Consumption has performed disappointingly after the pandemic. While the level of GDP is now 3.8% higher than that recorded in the fourth quarter of 2019, household consumption is barely 0.5% higher.
Regarding investment, the comparison with the pre-pandemic level is even worse. Investment is still 2.2% below its level before the arrival of the coronavirus, a gap that in the case of housing construction widens to 8.2%. However, investment shows signs of having begun to wake up. In the first quarter it rose 2.6% compared to the end of 2023, which represents the highest rate of advance since the start of 2023.
But the king by far in terms of growth continues to be the foreign sector, which contributed five tenths of the eight tenths that increased the Spanish GDP in the first quarter. And, inside this drawer, the undisputed protagonist was foreign tourismwhose GDP level is 40.3% above that recorded in the fourth quarter of 2019.
