Business 09/04/2021

Spanish government reduces economic growth forecast to 6.5%

The third wave of the pandemic sunk GDP during first quarter of the year

1 min
The Minister of Economy, Nadia Calviño.

MadridThe Spanish government admits that the economy is not recovering as fast as expected. The third wave of the coronavirus pandemic and the threat of a new wave will cause GDP this year to grow less than forecast, after plunging nearly 11% in 2020. The economic vice president, Nadia Calviño, announced on Friday a downward revision of the GDP growth forecast to 6.5%, seven tenths less than expected (7.2%), especially because the first quarter of the year results have been worse than expected. For 2022, the forecast is for GDP growth of 7%. "It is a prudent, realistic forecast and is aligned with leading national and international analysts," Calviño stressed.

The downward revision comes after agencies such as the Bank of Spain and the Independent Authority for Fiscal Responsibility (Airef) have also recently downgraded economic forecasts for 2021. The Airef estimates that Spanish GDP will grow by 6.6% this year, while the Bank of Spain is less optimistic and puts growth at 6%. The International Monetary Fund (IMF) has revised its forecast upwards to 6.4%

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