Post-covid recovery

Chamber of Commerce predicts Catalan GDP growth of 12% until 2022, one of the highest in Europe

Entity claims only thing that can slow growth are new outbreaks and restrictions on tourism

3 min
Mònica Roca i Aparici, president of the Barcelona Chamber of Commerce, at the presentation of the 2020 Economic Report of Catalonia

BarcelonaBarcelona's Chamber of Commerce's economic report for 2020 is the bleakest in its 50-year history. Presented this Friday, it shows Catalonia has registered the most intense fall in GDP among the main European countries (-11.6%), almost double the average in the euro zone (-6.6%). Even so, the various people responsible for drawing up this report are convinced that on the other side of the balance there is a recovery so pronounced that it will place Catalonia among the economies that will grow the most between this year and the next. Their only reservation is the effect recent covid-19 outbreaks and recommendations not to travel to Catalonia from its main tourist markets may have.

Precisely, one of the factors that explains the pandemic having such a big impact on Catalonia is the importance of foreign tourism for its economy. This and "the inferior volume of aid that has been granted to companies in this country," summed up Mònica Roca i Aparici, president of Barcelona's Chamber of Commerce.

Nevertheless, the director of this economic report, Carme Poveda, has explained that although they foresee that GDP will remain five points below pre-pandemic GDP, behaviour expected for 2022would mean Catalonia would be one of the fastest-growing economies in the euro zone: Spain would be first, followed by Ireland and then Catalonia. They say, however, that one of the factors that should improve the situation is that in summer mobility between countries will be restored. "We still do not know how the delta variant and restrictions imposed by other countries will affect this," Poveda admitted. "We have to see what this summer will be like," he added.

The president of the Generalitat, Pere Aragonès, has admitted during the same event that we are experiencing a new wave of covid-19 that "it could affect the economic recovery we had started".

What the most optimistic calculations of the Chamber foresee, without taking this into account, is that this year half of the tourist spending of 2019 will be recovered (7€bn), that Catalonia will receive €3bn from the European recovery funds and that part of the savings accumulated during the year of the pandemic (€3.5bn) will be spent. In total, therefore, they expect an injection of €13.5bn to consumption. "If these forecasts are met, the economy could end up growing more than the 6% we had estimated [for 2021]," concluded the director of the report.

Commitment to industry

Beyond the macroeconomic predictions, the Chamber has also taken the opportunity to advise that this recovery is used to modernise industry, which is one of the great strengths of the Catalan economy. This is based on data that shows that exports have already recovered pre-pandemic levels, that the number of regular exporting companies has fallen little and that the industry remains the main sector to which foreign investment is directed: the average of the last 4 years indicates that it accumulates 37% of investment. In addition, last year foreign investment in ICT multiplied by 3.5. "These two types of investment will be the key to creating a productive economy that offers quality jobs in the future," said Poveda.

Oriol Amat, professor of financial economics at the Universitat Pompeu Fabra, has added the analysis of the situation of companies after these months of pandemic. In summary, despite regretting that the covid crisis has returned Catalonia to a situation of destruction of companies that we had managed to leave behind in 2014 and a fall in activity that has ended up becoming a loss of productivity, this expert believes that in general companies have maintained their strength. "Catalan companies were capitalized and had a stronger financial situation to deal with the covid", Amat concluded. This applies especially in comparison to the 2008 crisis, which caught them heavily indebted and in a very weak financial situation