consumption

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The GDP of Catalonia increased by 1.5% during 2014, according to the definitive figures released by the Catalan Statistics Institute (Idescat) on Friday. However, on the same day, the Spanish Statistics Institute (INE) published its economic growth figures for 2014 and announced that the Catalan economy had grown by 1.4% last year, the same rate as Spain. In any case, both figures are quite positive after many years of economic crisis and slowdown. In fact, 2014 has been the best year since 2007, when the Catalan economy grew by 3.2% according to the Idescat. The final figure for 2014 is higher than the provisional 1.2% growth rate previously announced. Following European Union instructions, the calculations for last year include R&D activities, as well as prostitution and trafficking of drugs and tobacco.

The Catalan economy’s indicators are posting positive figures and the research department of the BBVA bank has reviewed its growth forecast for Catalonia for the current and the next years. According to the report issued on Thursday by the BBVA, the Catalan economy will grow by 1.3% in 2014 and by 1.8% in 2015, which are higher rates than those initially predicted. On top of this, 140,000 new jobs will be created in those two years, which represents a 4.3% employment growth. In addition, it puts an end to the negative trend that destroyed 17.3% of the existing jobs between 2008 and 2013. The BBVA also praises “the very significant effort” made by the Catalan Government to reduce public deficit in the last few years, although they will not be enough to meet the strict deficit objectives for 2014 and 2015, unilaterally imposed by the Spanish Government.

The pace of the Catalan economic recovery is "accelerating" according to Miquel Valls, the President of Barcelona's Chamber of Commerce. This is especially apparent in the second quarter of this year, which saw the interannual GDP grow by 1.3%, compared to the 0.4% growth registered in the first quarter of 2014. This rapid acceleration will oblige the Chamber to review in its autumn report its economic forecasts for Catalonia in 2014 and 2015, which are currently set at 1.2% and 1.5% respectively. Although there is still uncertainty to exactly what shape the new economic climate will take, the new predictions of growth could be above 1.5% for 2014 and 2% in 2015, indicated Valls.

The Catalan economy grew by 0.4% in the first quarter of 2014, which means that GDP has been increasing for the last 4 consecutive quarters, leaving recession far behind, according to an early estimate published on Monday by Catalonia’s Statistics Institute (Idescat) and the Catalan Ministry of the Economy and Knowledge. Furthermore, between March 2013 and March 2014, Catalonia’s economy grew by 0.8%. In the second quarter of 2013 it registered a quarterly growth of 0.1%; in the third it also posted a 0.1% quarterly growth; between October and December, it increased by 0,2%; and now, between January and March, it grew by 0.4%. The services sector has been the main engine behind this positive trend; in the last 12 months it grew by 1.4%.

The largest employer’s association in Catalonia, Foment del Treball, expects that the economic recovery in both Catalonia and the whole of Spain will not lead to a growth in employment and consumption until late 2014 or early 2015, as explained in the Report on the Economic Situation published on Thursday. The Director of Foment’s Economics and Taxation Department, Salvador Guillermo, said in a press conference that the economic recovery is being “consolidated”. Nevertheless, he added that ongoing structural reforms in the energy sector, public administration or the financial system should continue. According to Guillermo, the reduction of public deficit must be slowed down in order to avoid any negative impact on the economic recovery. 

The “very moderate” growth expectations for 2014, between 0.5% and 1%, will make it “difficult” for the unemployment rates to fall below the current 27%. This was the conclusion of the 2014 Economic Report of Barcelona-based ESADE, one of the top business schools in the world. The main author of the report stressed that this “slow and costly” growth should contribute only in a “very reduced” way to creating new jobs in 2014. However, he also explained that the Labour Market Reform would have positive effects on employment levels in the medium and long term. The study indicates that consumption in 2014 will “remain restricted” due to the high unemployment rates and reduced wages.

For the first time since the beginning of the crisis, sales have already shown a “slight recovery” during Christmas, highlighted the President of Catalonia’s Confederation of Commerce (CCC), Miguel Ángel Fraile, who is “very optimistic” about the upcoming winter sales. Indeed, during the months of November and December, retail consumption have registered an increase of 2% and 3% compared to the previous year. It is expected that Catalans will spend a total of about €800 million during the winter sales, between 3% and 5% more than last year. These estimates by CCC also indicate that, on average, each citizen will spend €90 for the purchase of clothing items.

Thousands of university students from the UK and Ireland come to the Saloufest, a sports tour during the day and a disco and street party at night. “We come to the Saloufest because there are a lot of parties, everything is very cheap and we feel safe” stated one UK student who arrived on Sunday and will party until Thursday in this coastal Catalan town with the first group of 4,000 people. The second and third groups will come after the Easter holidays, on the 2nd and 9th of April. The youngsters bring money in to the hotel, restaurant and bar sectors during a weak period of the year business-wise. However, many neighbours are fed up with the noise and other disturbances, and some locals even leave the town during these days.