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Home News Spain confirms exit from recession

Spain confirms exit from recession

Published on 28/11/2013

Spain said Thursday it has technically escaped a two-year recession by posting feeble growth in the third quarter, but with an unemployment rate still towering at 26 percent.

Gross domestic product, or total economic output, edged up by 0.1 percent in the third quarter of 2013, the National Statistics Institute said, confirming preliminary data released a month earlier.

The upward tick snapped an unbroken two-year downturn in activity in Spain, the eurozone’s fourth largest economy.

A significant recovery is still a distant prospect for many people, however, notably the 5.9 million in the jobless queue, representing 25.98 percent of the workforce in the third quarter, and many employees suffering from steep wage cuts.

Spain is struggling with the aftermath of a decade-long property bubble that imploded in 2008, throwing millions of people out of work, racking up huge debts for the government, banks and people, and plunging the economy into a double-dip recession.

Prime Minister Mariano Rajoy’s conservative government is forecasting a 1.3-percent economic contraction in 2013 and 0.7-growth in 2014, a rate considered by many analysts to be insufficient to lead to net job creation.

His Popular Party government, which took power in December 2011, has enacted economic reforms and austerity policies so as to curb annual deficits and rein in the national debt.

But the painful impact of the spending squeeze, high unemployment, and a slew of corruption scandals have sparked angry street protests.

The Bank of Spain, International Monetary Fund and European Commission are tipping an economic decline of between 1.4 and 1.6 percent this year.