New data shows Spain’s economy has been growing at an annual rate of more than 3% for the last 15 months.
This marks a sustained and stunning comeback for a country that was brought to its knees four years ago when Spanish banks had to be bailed out following a big housing market collapse, CNNMoney reported.
And the country is motoring despite not having a functioning government since late 2015.
Gridlock in the parliament means Spain has only a caretaker government. Voters face a third general election in quick succession later this year, but in the meantime the economy is moving along quite nicely.
Economic reforms introduced by former prime minister Mariano Rajoy have helped the country bounce back from a serious recession. The changes made it easier for companies to hire and fire, and set wages.
Plus, government spending in many areas has continued unabated because no one has the authority to reign in it. That could mean trouble ahead as borrowing rises, but for now it’s helping.
“Not only has the economy been on autopilot, but it’s gotten a boost from the fact that fiscal policy is looser than it otherwise should have been,” said Stephen Brown, a European economist at Capital Economics in London.
Spain is having a great year for tourism, with visitor numbers up 11% in the first seven months of the year.
This is partly because tourists are avoiding France, Turkey and Egypt, which have all suffered a series of terrorist attacks.
The influx of tourists has created more jobs. Unemployment recently dipped below 20% after peaking above 26% in 2013, and jobs in tourism have offered lower skilled workers a chance to find employment again.
