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BRIEF INTRODUCTION: From SPAIN BEYOND MYTHS, by Carlos Alonso Zaldivar
and Manuel Castells, Alianza Editorial, S.A.,
Madrid, 1992.
During the past thirty years, the Spanish economy has gone through three distinct periods: growth in the sixties (1960-1974), the crisis years (1975-1985) and the period of growth within the European Community (1985- 1990). During those 30 years, the economy has changed substantially: By 1990, the Gross Domestic Product (GDP) reached more than 50 trillion pesetas (491 billion dollars), and the income per capita stood at 1,141,900 pesetas (11,200 dollars). Spain's social and economic structure has also changed. In the early sixties, the agricultural sector accounted for 37% of the labour force and for 22% of GDP. In 1990, it accounted for 12% and for 5% respectively. As for industry, its share of the labour force rose from 30% to 33% and its share of GDP climbed from 33% to 39%. Finally in the services sector, the share of the labour force rose from 33% to 55% and the sector's share of GDP rose from 45% to 56%. In those years, Government expediture climbed from less than 15% in 1960 to 43.3% of GDP in 1990, a spectacular increase yet still below the European Community average (47.3% of GDP).
In 1991, the Spanish and world economic trends took a turn. The period of spectacular growth came to an end, at least temporarily. The Spanish economy continued however to grow at a faster pace (2.4% in GDP terms) than the Twelve (1.3% on average), recalling that a member country, the United Kingdom, even went into recession, with its GDP falling 1.8%. Nonetheless, Spain's current account deficit remained a matter of concern (2.9% of GDP in 1991). The State deficit was not cut down as expected, having widened to 4.4% of GDP. Inflation in turn (measured in terms of the deflator of private consumption) had risen to 6.3% by the end of the year (considering that the rate of variation of consumer prices since the beginning of the year was 5.5%), that is, less than the previous year. But the most negative feature was the decline of total employment, which drove up the rate of unemployment to 17% of the active population.
But in 1992, the situation of the Spanish economy was very different from that of 1982 or 1972. To put it briefly, the Spanish economy has become internationalised. Of total investment, which accounts for 25 points of GDP, about 5 points represent foreign investment, an inflow that has continued since then. The economy has become more exposed to foreign competition (by cutting down tariffs and dismantling other trade barriers), and at the same time there are more opportunities for Spanish exports. Future growth is tied to export growth. In 1991, foreign trade accounted for 29% of GDP. The Single European Market is now presenting a new challenge to Spain's foreign trade. In addition, the Spanish economy is expected to become even more clsely integrated over the next few years through the Single European Market and the Economic anbd Monetary Union (EMU). It is also expected to expand throughout the European Economic Area (EEA) and by means of future enlargements of the European Community (European Union, today), as well as internationally, as a result of the globalisation of markets and the possible reduction of protectionism in the agricultural and service sectors as a result of the Uruguay Round of the GATT will bring about a greater world projection of the European economy.
(End of introduction)
You can get more information about the topics of this chapter at:
ECONOMIC AND COMMERCIAL SECTION OF THE EMBASSY OF SPAIN
151 Slater Street, Suite 801
Ottawa, Ontario, K1P 5H3
Canada
Phone Number 613. 236 0409
613. 236 0400
Fax 613. 563 2849
Thank-you very much.
