Since last year the Bank of Spain in its annual report warned that the productivity of the Spanish economy in the last 15 years had moved away from Europe, the problem has not stopped growing. Last week Eurostat certified that in 2022 (last year available) only Madrid and the two regional autonomous communities (Basque Country and Navarra) have a GDP per inhabitant higher than the European average taking purchasing power into account. They are the only Spanish regions where workers manage to perform above their European colleagues. They are more productive.
Not in the rest, including Catalonia. Eurostat statistics show that Catalonia is one tenth of a percentage point away from the European average. But it is suffering – as the Cercle d’Economia also warned last year – a widening of the gap with Europe in productivity until at least 2022.
Eurostat statistics give 100 to the European average GDP per inhabitant, taking into account purchasing power so that it can be compared. Catalonia closed 2023 with 99 compared to the 108 it had in 2019 before the crisis broke out. The flame of hope among economists is that this trend will have been broken in 2023. In fact, in the period 2019-2023, Catalonia has grown more than the EU in absolute GDP thanks above all to last year, which was better than expected.
But the virus of loss of competitiveness is not the heritage of Catalonia but of all communities. The three that lead the ranking and are above the European average also distance themselves from their richer neighbors. Madrid before the pandemic had a GDP per inhabitant of 124, so it was 24% above the average. Last year it had lowered its index to 117. It is only 17% above the average for regions on the continent. The Basque Country has gone from 117 to 109 and Navarra, from 110 to 103.
The director of the Chamber of Commerce studies service, Joan Ramon Rovira, points out that “the worst relative performance of the autonomous communities in 2022 may be related to the slower recovery that occurred in the Spanish economy,” which was the last European countries to return to the level of GDP (everything produced in a year) prior to the pandemic.
Spain as a whole has a GDP per inhabitant of 86 (14% below the average) compared to 91 in 2019.
Within Spain, the productivity data clearly marks two countries. Northern regions with a GDP per capita of at least 75% of the average. And the southern half where they are all below from Extremadura to Valencia passing through Andalusia, which is the one with the worst index: it is 36% below the average.
And although last year's stronger recovery may bring a turnaround, some economists warn it will be a long road. In a recent report by Fedea and the Council of Economists, it was warned that with data up to 2022 (the same period analyzed by Eurostat) there is no “evidence” that the European Next Generation recovery funds have contributed to increasing the productivity of the economy of the country. In the same work, it was warned that in the period 2007-2022, the two regional communities –Navarra and the Basque Country– had managed not to lose productivity with the EU. He was accompanied on that podium by Galicia and Castilla-La Mancha.
If a broader period is analyzed and the focus is broadened, the situation remains similar with a chronic loss of productivity with Europe. The data was analyzed by the IVIE with the BBVA Foundation. Researchers from the Valencian center warned that so far this century the decline in productivity is 7.3%. On the other hand, in that period, Germany advanced 11.8% and the United States 15.5%.
Joan Ramon Rovira clarifies that last year the German economy suffered more than others in the European Union. Germany's GDP contracted by 0.3 last year. In contrast, Eurostat data for 2022 shows that the German economy is 17% above average. Although the country has also lost compared to 2019, when productivity was 21% above the European average.
The most dynamic regions in Europe are two Irish regions and Luxembourg. On the other side, in the caboose, are three regions of Turkey.
