Published on Thursday, December 15, 2022 | Updated on Thursday, December 15, 2022

Spain | Regional Economic Outlook. December 2022

The economy is more resilient than expected in 2022. In the first half of the year, due to domestic demand and tourism, and in the fourth quarter, due to exports and employment. In 2023 and 2024, external demand will contribute negatively, but NGEU funds and reduced uncertainty will drive the recovery, faster in the north.

Key points

  • Key points:
  • In 2022, Balearic and Canary Islands see their forecast improved by tourism growth, particularly in the first half, which is already above 2019 levels.
  • Exports and employment show better data in the fourth quarter. The latter, moreover, helps the resilience of household spending and supports the upward revisions in Murcia and Castilla-La Mancha, Madrid, Castilla y León, Catalonia, Galicia and Navarre.
  • The eurozone's entry into recession and the exhaustion of the recovery in tourism will mean that the contribution to growth of external demand will be negative in 2023 and 2024. Even so, the Balearic and Canary Islands will lead growth in 2023.
  • The biggest accelerations, especially in 2024, will be seen in the Autonomous Regions producing investment goods and automobiles and with exports to Europe and able to take greater advantage of the boost from the NGEU funds: the largest upward revisions occur in 2023 in the Basque Country, Navarre and Galicia, while the rest of the northern regions will approach Spain's average growth in 2023, to exceed or equal it in 2024.

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