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Spain
Domestic Market. The rapid growth of the Spanish economy in recent years
has been driven by strong domestic demand in the context of an increasingly open
economy. Spain has a market of 43 million people with an estimated per capita
income of roughly 20,800 €, plus an additional injection of demand coming from
the 82.6 million people who visit the country in 2003.
Spain is an extremely dynamic country, and has traditionally achieved very
high economic growth rates, over and above the average for other industrialized
countries. According to Bank of Spain, growth in 2003 was 2.4 percent,
significantly above the EU, where average GDP growth reached just 0.6 percent
last year and GDP was around US$ 743 billion in 2003.
Inflation in Spain has fallen steadily since the late 1980’s. The rate of
inflation was kept under 5% for the first time in 1993, and was further reduced
in subsequent years to under 4% and its current 2.6%. In February 2004, the
inflation posted a year-on-year rate of 2.1%.
The impressive reduction in Spain's long term interest rates from 10% in 1993
to the current 4.2% is particularly noteworthy.
Since joining the European Union, Spain has experienced sweeping changes in
foreign trade. Exports have grown faster than international commerce, increasing
Spain’s share of world trade. At the same time, Spain’s industrial sector has
naturally looked to the European market: exports and imports are for the most
part with EU member nations, following the development of competitive
advantages, as the result of the restructuring of Spain’s industries over the
last decade.
Spain’s main trading partners are EU countries, representing 71% of total
exports and 63% of total imports. Japan accounted for 0.7% of exports and 2% of
imports in year 2003. Latin American countries made up for 4% of Spanish exports
and 3% of imports, while the US accounted for 4% of Spanish exports and 3% of
its imports.
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