World Economy

Spain Economy to Grow by 2.6%

The government plans to cut unemployment by 488,000.The government plans to cut unemployment by 488,000.

Spain’s economy would grow by 2.6% in 2018, according to the last predictions announced by the  government.

The government has revised up its economic predictions for both 2017 and 2018. The Spanish economy would grow by 3% this year, as opposed to the previously predicted 2.7%, and by 2.6% in 2018, as opposed to the previously predicted 2.5%, Xinhua reported.

It also predicted a 17.4% unemployment rate for 2017, which is 0.1 percentage point lower than the rate previously predicted, and a 15.4% unemployment rate for 2018, which is 0.2 percentage point lower than previous forecast.

Government says this year a total of 518,000 jobs will be created which will help cut unemployment by 488,000 to 3.75 million people. In 2018, it is expected that there will be 503,000 jobs more, while unemployed people would fall by 393,000 to 3.36 million.

Unemployment rate is expected to fall to 11.1% by 2020 with more than 20.5 million jobs.

Spain’s Minister of Economy and Competitiveness, Luis de Guindos, said that the recovery of employment takes time, explaining that the crisis hitting Spain is hard. However he said that the effect of economic growth on job creation was ‘very intense’.

Meanwhile, Spain’s inflation rate picked up faster than expected in April after March’s pullback, the country’s statistics agency has confirmed.

Final readings showed consumer prices rose 2.6% in the year to April on san EU-harmonized basis, confirming initial estimates released late last month. Economists had initially expected an increase of 2.3%.

Prices increased by 0.9% over the month, with clothing and footwear seeing the biggest rise. “Leisure and culture” costs also contributed to the rise, alongside higher prices for hotels, cafes and restaurants.

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