Published on Wednesday, June 28, 2023

Spain | Catalonia Economic Outlook. First half 2023

Catalonia's GDP to grow by 2.6% in 2023 and 2.0% in 2024. Catalonia will return to the pre-pandemic level of GDP in 2023, and throughout 2024 it could regain that of GDP per capita. Almost 180,000 new jobs could be created between 2023 and 2024.

Key points

  • Key points:
  • The economy is slowing down, although less than anticipated a few months ago. The slowdown in investment and household spending, due to uncertainty, inflation and interest rates, is limiting the contribution of domestic demand. But exports (particularly services and tourism) and employment have remained buoyant in the first months of 2023.
  • Industrial and construction activity will gain traction as NGEU funds are implemented and uncertainties affecting households and businesses fade. The progressive resolution of bottlenecks and certainty about energy costs will support the recovery of the industrial sector, with particular importance for the automotive sector.
  • The correction of inflation will continue and the upward path of interest rates is already expected to be short. No imbalances are observed in the economic sectors, and Catalan households have more wealth than in 2019.
  • Several factors will condition the advance of activity in 2024: higher interest rates for longer than anticipated, capacity restrictions in sectors such as tourism and housing, a slower than anticipated impact of the NGEU Funds on private investment, and the fiscal consolidation expected next year.

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