Better economic growth, 2.7% in 2015 and 3% in 2016, predicts Catalan Chamber of Commerce

Barcelona (ACN) .- Barcelona's Chamber of Commerce has predicted that the Catalan economy will grow by 2.7% in 2015 and 3% in 2016, according to the Situation and Forecast Analysis published on Thursday. The figures represent an improvement from the latest estimates made by the Chamber in February which foresaw a growth of 2.5% in the Catalan GDP for this year. The President of the Chamber of Commerce, Miquel Valls, said that this growth "has a lot to do with the surprising recovery of domestic demand, driven by job creation, and increased confidence in the economy." Valls also said that the depreciation of the euro and oil prices are factors that have contributed to the rise in GDP. Besides, the Spanish economy is expected to grow by 2.5% in 2015 according to the IMF or by 2.8% or 2.9% according to the Bank of Spain and the Spanish Government respectively.

Specifically, the report from Barcelona's Chamber of Commerce estimates the rate of acceleration to be both "high and consistent" which will allow annual growth rates to exceed 3% from this year. The study also highlights that private consumption will contribute 57% and investment 30% of the growth in gross domestic product in 2015. Valls explained that the increase in private consumption is mainly due to an improvement in employment in recent quarterly terms.

The second factor in the recovery is productive investment, according to data for investment in capital goods and the rise in construction investment for the first time in seven years. Valls noted factors such as the 62% annual growth in vehicle registrations in the first quarter or cement consumption, which recorded positive rates for the first time since the start of the financial crisis in 2008.

Thirdly, the foreign sector is witnessing good results, together with the whole of the Spanish economy, encouraged by the depreciation of the euro and the economic recovery in Europe. Valls stressed that the exportation of goods and the rise of foreign tourists is "at a record high". The effect of the depreciation of the euro is being felt in sales outside of the euro zone, such as in the United Kingdom (with an 18% annual increase), the USA (19.3% increase) and in countries in Asia (17.2 % increase).

In addition to the weakness of the euro, Valls also explained that there are other external factors that are encouraging the growth of the Catalan economy. The report from the Chamber of Commerce cites low oil prices and low interest rates, coupled with the expansion of the ECB's (European Central Bank's) monetary policy. Valls noted that these factors are "temporary" and that it is essential to persist with structural reforms, such as those in public administration, in order to "strengthen" competitiveness and ensure the balance of public accounts.

Annual growth of 2.2% in the first quarter in Catalonia

Regarding quarterly terms, the report from Barcelona's Chamber of Commerce has predicted that Catalan GDP grew by 0.7% during the first three months of the year, at the same rate as at the end of 2014. Similarly, the Chamber has predicted that the annual gross domestic product growth will rise from 1.9% in the fourth quarter of 2014 to 2.2% in the first quarter of 2015, the highest figure since early 2008.

Spanish economy registers a 0.9% growth in quarterly terms

According to the Spanish Statistics Institute's ( INE) calculations, also released this Thursday, the Spanish GDP increased by 0.9% in the first quarter of 2015 compared with the previous quarter, higher than the 0.7% quarterly growth registered over the last three months of 2014. Thus, the Spanish economy has seen economic growth in seven consecutive quarters and expects more. In the first quarter of this year the Spanish economy has noted the best quarterly growth rate since the end of 2007.

The calculation made by the INE of a 0.9% growth in this quarter is higher than the 0.8% prediction made by the Bank of Spain. Thus, economic data for the first quarter confirms good economic development anticipated by both the Bank of Spain and the Spanish Government, which in recent months have revised their estimates. For the entire of 2015, the banking regulator has forecast a 2.8% growth in GDP and the Spanish Government has predicted 2.9%. The latest forecasts made by the International Monetary Fund (IMF) are more modest and locate the growth of the Spanish economy throughout the year at 2.5%.

The data provided by the INE on Thursday remains provisional and will be confirmed on the 28^th of May, when it will provide all the details regarding Spain's accounting, the sectors that are propelling the economy forward and the sectors that have grown less.