Economic growth forecast for 2016 adjusted upward to 3.4%

Barcelona (CNA).- The expected growth of the Catalan economy in 2016 has been adjusted upward to 3.4%, a figure which is  0.5% higher than that forecast for the Spanish economy. According to the macroeconomic chart released this Wednesday by the Catalan Ministry for Economy and Tax Office, the growth expected for 2017 is 2.7%, which is “considerably higher” than the 1.5% growth forecast for the Eurozone, as Catalan Vice-president and Minister for Economy and Tax Office, Oriol Junqueras explained. The macroeconomic chart also expects Catalonia to close 2016 with a 16% unemployment rate and that this will be 14.4% by the end of 2017. The data included in the macroeconomic chart will be included in the budget for 2017, which the Catalan executive expects to pass next week.   

Since the Spanish executive hasn’t published their economic forecasts for 2017, the Government has decided to adjust the budget for 2017, which will be put to vote in the Parliament next Tuesday, to its own forecasts. According to these estimations, Catalonia’s GDP in 2016 will amount to €223 billion and in 2017 will reach €232 billion.

Thus, the economic growth forecast for 2016 will equal that of 2015 and has to be adjusted upward to 3.4%, 0.5% more than the last estimation, in May. This new forecast also doubles that for the Eurozone (1.7%). 

14.4% unemployment rate in 2017

The budget for 2017 also foresees the creation of 160,000 jobs between 2016 and 2017. In 2015, 71,600 jobs were created, which represented 2.4% more than last year. For 2016, the chart foresees 91,000 jobs being created. In 2017 this pace will be slower and 69,000 new jobs are expected to be created.

Growth in private consumption

Regarding private consumption, the figures confirm the growing trend. For 2017, the internal demand will keep on growing, “encouraged” by families’ consumption, although their contribution to the GDP will be “moderate” in comparison to that of 2015. Two years ago, this consumption was 3.5%, it is 3% in 2016 and the contribution for 2017 is expected to be 2.2%.

Public consumption will maintain its recovery, which started in 2015, at a “soft pace”, explained Junqueras. For 2016, growth in this sector is 1.2% and it will be 1.3% in 2017.

Exports to continue positive trend

Regarding business investment, Gross Capital Formation will keep the positive trend seen in the last years, mainly due to the economy’s “strength”, the “relaxation” of conditions for accessing credit and low interest rates.

In relation to external demand, the chart outlines the goods exports figures. The forecast expects 5.5% growth in exports in 2015 and 4.9% in 2017.

On the other hand, imports will “slow” their growth progressively, posting 6.4% in 2016 and 4.6% in 2017.

Thus, Catalonia’s international commercial trade won’t have any effect on the 2016 GDP, whereas it will post a positive contribution of 0.5% in 2017.

Regarding commercial trade with the rest of Spain, this will contribute by 0.3% to the GDP in 2016 and 0.1% in 2017.