MADRID – Spanish GDP shrunk less than forecast

Spain’s GDP shrunk 17.8% in the second quarter of the year, which is seven tenths less than previously forecast on 31 July, right after the end of the national “state of alarm” implemented by the government to contain the rapid spread of the COVID-19 pandemic, the country’s National Institute of Statistics (INE) reported on Wednesday.

This GDP decline, the largest since 1970, has intensified compared to the 5.2% contraction in the first quarter of the year, and – in practical terms – this means that the Spanish economy is in recession, after two quarters of GDP consecutive decreases, EURACTIV’s partner EFE reported.

The COVID-19 pandemic has severely hit the country’s economy, in particular the tourism sector, which accounts for 12.3% of Spain’s GDP. Since last March many companies had to implement temporary lay-off schemes financed by the state to preserve thousands of jobs.

Madrid is currently the epicentre in Spain.

On 21 September new measures to combat the fast spread of the virus in the capital entered into force, limiting social gatherings to no more than six people and putting neighbourhoods in the southern (poorest) districts of the capital which have seen the most infections back into partial lockdown for at least 14 days.

(EUROEFE)

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