Spain’s one-month lockdown milestone was met with foreboding news of an economic recession from the International Monetary Fund but authorities insisted the urgent focus remained on saving lives.
Thousands of employees, mainly those in construction, manufacturing and other roles that don’t allow for remote working, returned to work on Tuesday (14 April) after the government tentatively lifted a two-week period of economic suspension designed to stymie the overwhelming impact of the COVID-19 pandemic on Intensive Care Units (ICUs).
Some light was cast on the possible financial side-effects of keeping the majority of the country’s 47 million people housebound from 14 March until 26 April at least when the IMF predicted that the Spanish economy would contract by 8% this year.
In its half-yearly World Economic Outlook report released on Tuesday, the IMF also forecast the number of unemployed in Spain would hit 20.8% as it warned the world economy could see a global recession this year akin to the Great Depression and “much worse than during the 2008–09 financial crisis.”
The report said Spain’s economy would rebound and grow by 4% in 2021 if the pandemic subsided by the second half of this year.
Pedro Sánchez’s Socialist Party-led government is acutely aware of the looming task of guiding the country out of the economic recession expected as a result of the strict confinement measures.
Having strongly urged the European Union to help share the burden of debt accumulated by efforts to deal with the crisis, the Spanish Prime Minister had turned his focus to sealing a national pact with other party leaders.
His government spokesperson, María Jesús Montero, said it was too early to evaluate the definite economic impact the coronavirus pandemic will have in Spain.
“These are preliminary figures,” she said of the IMF’s report at a daily press briefing. “We have to wait a few more weeks.”
“Right now the priority is still to save lives and minimise the damage to our production capabilities,” she added.
Montero announced a government initiative to let small and medium businesses and the self-employed who earn less than €600,000 a year to delay their tax returns in April for a month. The measure would affect roughly 3.4 million Spanish taxpayers.
The Prime Minister’s spokesperson added that 940,000 people had turned to the state welfare system to access aid set up to help those temporarily laid-off or who have been handed a temporary pay cut. Last month Spain said around 900,000 jobs were lost because of the virus.
Salvador Illa, the health minister, on Tuesday said the curve of new infections was flattening but that the country should keep the confinement measures in place.
Spain’s health ministry earlier said 567 coronavirus-patients had died in the last 24 hours, an increase on the 517 detected in the same period on Monday. A total of 18,056 people have died overall.
Some 3,045 new infections were also reported between Monday and Tuesday, bringing the total to just above 172,500 since the outbreak began, roughly 87,000 of which are active.
Fernando Simón, the head of Spain’s public health emergency department, said the figures could be prone to a margin of error given the Easter holiday period over the weekend, adding that although the daily trend in new infections had started to slow, the rate was still high at around 3,000 every 24 hours.
In a bid to get a better picture of the full extent of the COVID-19 crisis in Spain, one of the worst hotspots globally, the government has issued a decree allowing regional authorities to take control of any diagnostic clinic, public or private, that was not already providing data to the national public health system.
The move also aims to regulate the price private clinics were setting for tests, specifically rapid-testing kits.
“First we have to get access to those results and second make sure that their use are not being abused by any party involved,” Simón said, adding that the rapid-testing kits had little effectiveness on asymptomatic carriers of the virus.
As Spain seemingly gets on top of the infection rate, authorities in Madrid have closed the makeshift morgue at the Palacio de Hielo ice rink in the suburb of Majadahonda that had been set up when the city’s funeral homes and crematoriums became overwhelmed with the number of COVID-19 fatalities.
Sánchez is due to meet with opposition Popular Party leader Pablo Casado on Thursday to discuss the proposed national pact to exit the crisis, which the Socialist Party has insisted must avoid the kind of austerity measures Spain agreed to in the wake of the 2008-9 crisis.
(Edited by Frédéric Simon)