World Economy

Spanish Growth Expands 3.1 Percent in 2017

Spanish Growth Expands 3.1 Percent in 2017
Spanish Growth Expands 3.1 Percent in 2017

Spain’s economy likely expanded by 0.7% in the fourth quarter of 2017 compared with the previous quarter, putting the eurozone’s fourth-largest economy on track to report an annual growth rate of 3.1%, the country’s national statistics agency said in preliminary data released Tuesday.

That quarterly rate, if confirmed, is a slight slowdown from the 0.8% rate of expansion in the third quarter. The fourth-quarter rate is also slower than the real-time estimate of a 0.77% growth rate published by Spain’s fiscal watchdog, a closely-watched figure. Economists expect Spain’ growth rate to slow this year, MarketWatch reported.

Although the figure represented a slight slowdown compared to the previous quarter, and the weakest quarterly growth rate of the year, it was in line with economist forecasts.

A 3.1% expansion for the year as a whole marked Spain’s third successive year of above 3% growth, as a wider upturn across the eurozone amplified the domestic recovery.

Earlier this month analysts at Barclays suggested Spain “could be making a transition from the periphery into the semi-core economies”, less than six years after the government was forced to request an EU bailout to rescue its financial sector. The premium investors demand to hold Spanish government debt has fallen to its lowest level since 2010, and the country has returned to the upper echelons of sovereign lenders with Fitch upgrading its credit rating to A-, its first A rating since the eurozone debt crisis.

Spain’s economy began to grow in 2013 after years of recession and is now expanding faster than most major eurozone countries.

 Rich-Poor Gap Widens

A new report revealed that in Spain, economic growth has favored the rich, with Oxfam Intercom ranking it as the third country in the European Union where inequality has grown the most since the crisis began, TheLocal reported.  

Last year saw the creation of 7,000 new millionaires in Spain. The combined fortunes of Spain’s top three richest people are equivalent to the wealth of the poorest 30% of the country, that is, of 14.2 million people.

Spain’s Gini coefficient, the most widely used measure for income inequality ranks among the highest in Europe with Gini indices at 0.34. The maximum value of the coefficient is one, in which a single individual owns all the income in a country, and the minimum is zero, in which everyone has the same income.

Some 10.2 million people in Spain live below the poverty line, equivalent to a poverty rate of 22.3%. This makes Spain the third country in the European Union with the highest levels of inequality.

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