Spain | Cantabria Economic Outlook 2023

Summary

Cantabria's economy will grow by 2.0% in 2023, and will accelerate to 2.5% in 2024. This will allow a return to the pre-pandemic GDP level this year.

Key points

• Key points:
• After increasing by 4.0% in 2022, Cantabria's GDP will continue to recover in 2023 and 2024, with increases of 2.0% and 2.5%, respectively. Cantabria could return to the pre-pandemic level of GDP throughout 2023, but the GDP per capita level will not be reached until early 2024. Between 2023 and 2024, almost 9,500 new jobs could be created.
• The economy is slowing down, although less than anticipated a few months ago, due to inflation, interest rates and uncertainty that slow down investment and household spending, limiting their contribution to domestic demand. But exports (particularly, services and tourism) and employment have maintained high dynamism in the first months of 2023.
• Industrial and construction activity will gain traction as NGEU funds are deployed and uncertainties affecting families and businesses fade. The progressive resolution of bottlenecks and certainty about the cost of energy will support the recovery of the industrial sector. The inflation correction will continue and it is expected that the upward path in interest rates will already be short.
• Several factors will determine the progress of activity in 2024. Among them, high rates for longer than anticipated, capacity restrictions in sectors such as tourism or housing, an impact of the NGEU Funds on private investment that is proving slower than what was anticipated, the fiscal consolidation planned for next year or the uncertainty of economic policy.

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