Cercle warns that the Spanish economy is “doomed to mediocrity”

New call of attention from the Cercle d'Economia on the progress of the country and the impact of chronic low productivity.

Oliver Thansan
Oliver Thansan
15 May 2024 Wednesday 16:23
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Cercle warns that the Spanish economy is “doomed to mediocrity”

New call of attention from the Cercle d'Economia on the progress of the country and the impact of chronic low productivity. The institution has warned today in the traditional Opinion Note prior to the Cercle Annual Meeting that “the recent dynamics are worrying” and that “they show an economy doomed to mediocrity if action is not taken in an urgent, coordinated and determined manner.”

In a study, the organization chaired by Jaume Guardiola points out that “there is a close relationship between productivity growth and the population's income.” Cercle recalls that in “the most productive regions of Europe, workers receive higher salaries and, at the same time, precisely because they are more productive, they work fewer hours.”

The Opinion Note adds that “greater productivity is the key element so that all citizens can enjoy a better quality of life.” Between 2000 and 2022, the distance in productivity between Spain and the European Union has doubled. At the beginning of the century, Spanish productivity was 6% lower than European productivity and now it is 12%. “Our economy increasingly resembles that of the less productive regions of the EU,” says Cercle.

In the note, Cercle proposes a series of measures to correct the situation. Among these, the reform of the educational system stands out.

The institution also demands a new financing model that grants more resources to the autonomous communities. Their proposal is that of 2018 when they supported shared tax collection between the central and regional administrations.