Spain posts steady growth despite political impasse

29th April 2016, Comments 0 comments

Spain's economy grew at a steady pace in the first quarter, official data showed Friday, despite a political stalemate that has left the country without a government since December.

Gross domestic product (GDP) expanded by 0.8 percent between January and March from the previous three months, matching growth in the previous two quarters, according to preliminary figures from national statistics institute, INE.

On a year-on-year basis, Spain's GDP grew by 3.4 percent during the first quarter, a slight slowdown from the final three months of 2015 when it rose by 3.5 percent, it added.

Spain was hit hard by the global financial crisis, experiencing five difficult years of on-off recession that saw unemployment rocket from a low of around eight percent in 2007 to a high of 27 percent in the first quarter of 2013.

Spain's conservatives, who came to power in 2011, implemented a tough austerity programme as the country teetered on the edge of bankruptcy, cutting spending and raising taxes in a bid to stimulate growth and reduce unemployment.

Last year, the Spanish economy, the eurozone's fourth largest, expanded by 3.2 percent -- one of the fastest growing rates in Europe.

The government predicts the economy will expand by 2.7 percent this year before picking up to 2.9 percent in 2017.

Spain has been without a fully functioning government since an inconclusive December 20 general election that resulted in a hung parliament with power divided among four main groupings, none of them with enough seats to govern alone.

The country is heading for its second general election in six months in June after King Felipe on Tuesday concluded that it would be impossible for parties to piece together a governing majority.

© 2016 AFP

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