Do we have Sánchez for a while? What the economy forecasts

“Never let reality spoil a good story.” With inflation at 5.4%, the electricity bill through the roof, national and international organizations (with the notable exception of the Government) lowering growth forecasts and the unemployment rate at 14.5%, I started a round of calls between prestigious economists to see if they believe that the coalition government will be able to hold out until 2023.

The idea was to say that the legislature is complicated. But, after speaking with those who know the macro well, I opted for caution: the data says that Sanchez can hold out to the end. Not without difficulties, but yes. Yolanda Diaz does not break the coalition, the perfect storm that we have in the economy can be a cloud that endures without thundering until the elections. Another thing is the inheritance that the next tenant of the Moncloa will receive (if the expected turnaround occurs Paul Married).

The common sense of the reader – who will be thinking about how the Government is going to survive this cold winter with these energy prices – can cast doubt on some macro projections that, it must be said, are constantly being revised downwards. But for now, there is room.

The President of the Government, Pedro Sánchez.

The President of the Government, Pedro Sánchez.

In a private conversation, one of the best-known economists in this country said a few weeks ago that, even if the government took the rain of millions that is going to come from Europe (if the reforms are approved) and threw the banknotes off the balcony, the European funds would boost the Spanish economy.

It thus illustrated that, even if all the investment plans failed, the mere receipt of that extraordinary volume of transfers would have a positive effect on the pockets of the Spanish people. Each time it is estimated that this impact will be less due to the delay of the Plan, the doubts about the structural reforms and the growing frustration of the business world with Next Generation EU. But it is undeniable: 70,000 million euros are a help for Sánchez.

Then there is the evolution of GDP. That Spain is at the bottom of the recovery of the European Union is not good news. The question is, will the citizen notice?

The Funcas panel has just lowered the forecasts to 4.8% for 2021 and 5.7% for 2022. These are poor data (do not forget the sharp drop in GDP in 2020), but they do not stop showing growth, which is will translate into employment thanks to the inertia introduced by the 2012 labor reform, not yet repealed.

That Spain is at the bottom of the recovery of the European Union is not good news. The question is, will the citizen notice?

“If employment grows in 2022, families would notice a positive effect on their pockets,” says the head of a study service. Despite inflation? This is the key.

At this point, the Government has a joker, although whether he can take it out to finish the game is not up to him. The scenario that drives the economic consensus is that energy prices will begin to give a truce in the spring of 2022.

We will see if it is fulfilled because it is a fact that from the management of some companies is taken with tweezers, but for the moment, it is what the forecasts say. And if it is confirmed, families could begin to notice another relief in their pocket starting next spring. Air for the Government to finish the legislature.

If that projection is wrong, Sánchez and Díaz will have a problem, but much less than that of the Executive that succeeds them and that will be the one that has to pay the bills of this pandemic.

José Luis Escrivá, Yolanda Díaz, Pablo Casado, José Félix Tezanos, Pedro Sánchez, María Jesús Montero and Christine Lagarde.

José Luis Escrivá, Yolanda Díaz, Pablo Casado, José Félix Tezanos, Pedro Sánchez, María Jesús Montero and Christine Lagarde.

Inflation in the eurozone will no longer be “transitory” when the authorities decide that it is “permanent”. It will be then when Christine Lagarde accelerate the withdrawal of stimuli and raise rates.

The landscape for Spain will darken. However, in budgetary terms, this rate hike will not have an immediate effect. In these years of free money, the Treasury has been prolonging the average life of the Spanish debt and now it is seven and a half years.

This implies that a rate hike by the ECB will not have a severe budgetary impact in the first year. The sweat to finance itself will come from the first five years. Another trick in favor of the president’s resistance.

However, the stock market, which always anticipates the macro, has already given a warning to Spain. The Ibex 35 is the ugly duckling of Europe in 2021 and the FTSE Mib of Italy in mario draghi It takes you a big advantage. Do the citizens know?

There is another great unknown for 2022. What will the Government do with its tax reform? As already reflected by the CIS of Jose Felix Tezanosthe Spanish begin to worry about the rise in taxes.

The announcement of the taxes that will rise and the calendar will come in 2022. But Brussels will still have its fiscal rules suspended, which gives room for Maria Jesus Montero to delay the entry into force of those measures that will hit growth in the medium term. Another problem for the next government.

Although the macro projections are not buoyant, the Government can hold out until 2023. It has the unions in its favor – important to control the street – and the tailwind of the end of austerity blowing in its favor in times of energy crisis and supplies.

Another thing is its internal troubles and the effects that its reforms have on the future of Spain. What happened with the rise in the prices of Write to finance pensions confirms the worst fears of the economic world. The loss of competitiveness will be noticed in the next legislature much more than in this one. And it will be then that the social democratic Germany of scholz restore fiscal rules to put public finances in order (Next Generation it’s not free).

as i said James Carville in his hackneyed phrase: “it’s the economy, stupid”. Only in this case, the message is no longer for the politician, it is for the voter.


This study of Canvas Sustainable Strategies in which it reflects that for society, the first purpose that companies must have is the creation of employment and prosperity. This social demand for businessmen is above that of reducing emissions, contributing to reducing inequalities or innovating in products and services.

Source: Canvas

Source: Canvas

It is a striking fact that was presented last week in a forum organized by this newspaper and DKV on the insurance sector. Economic policy should take this into account, given the importance for individuals of creating jobs in the current context.

The President of the Government, Pedro Sánchez.


Leave a Reply

Your email address will not be published.