ExpertEye European Automotive Report Q3 2016 | Page 24

Spain – Growth outperforming expectations

.

Spain continues to defy most economists’ expectations with strong growth in

Economic Forecasts

the first three quarters which is expected to see a GDP rise by 3.2% this year.

GDP growth (%. yoy)

Unemployment is continuing to drop steadily and by 2018 is forecast to be
16.5%. However it remains well above the European average and as such
wage rises are expected to be nominal which may go some way to explaining
why the European Sentiment Indicator has fallen again, dropping 1.5 points

2015 2016 2017 2018
3.2

3.2

2.3

2.1

Inflation (%. yoy)

(0.6)

(0.4)

1.6

1.5

Unemployment (%)

22.1

19.7

18.0

16.5

Public budget balance (% of GDP)

(5.1)

(4.6)

(3.8)

(3.2)

Gross public debt (% of GDP)

99.8

99.5

99.9

100.0

Current account balance (% of GDP)

1.3

1.7

1.5

1.5

over the last quarter.
With wages held back private consumption, which remains the key driver of

RV Index: 36 months / 90,000 kms
120

Europe Average

growth, is expected to slow down in part exacerbated by rising inflation as
the oil price drops unwind. However exports are on the rise particularly in
the service sector compared to 2015 which should see net exports boosting

Spain

115
110

growth through 2017 and 2018.
The biggest challenge for the new minority government formed by Popular
Party leader Mariano Rajoy is how to bring the public budget deficit back in
line with the EU’s requirement to be under 3%. As mentioned earlier Spain

105
100
95

was highlighted along with Portugal for being well above that limit in 2015

are “doing enough” the reality is Spain is still expected to be above that
target at the end of 2018. Whilst the EC have extended the deadline for a 3%

European Automotive Report - 2016 Quarter 3

2016 09

2016 05

2016 01

2015 09

2015 05

2015 01

2014 09

2014 05

2014 01

2013 09

2013 05

2013 01

2012 09

2012 05

2012 01

2011 09

2011 05

2011 01

2010 09

spreading globally. Whilst vice president Dombrovskis has said both countries

2010 05

“EC” try to avoid further fuelling the anti-establishment populist uprising

90
2010 01

and yet it has received no fines or sanctions as the European Commission

Sources: European Commission – Economic Forecasts ExpertEye AG - RV Index
Bowkett Auto Consulting Ltd - Forecast vehicle sales

23