The report released this week by the major international economic organizations and the European Commission agree on one message: about the end of the expansionary cycle, and the Spanish economy needs to improve his positioning to deal with it.
One of the main stumbling blocks is the weakening of the international environment. For the third time so far this year, the OECD has cut its forecast of global growth to 2019. Now anticipates 3.5%, two tenths less than in the round of September, and four less than in may. The loss of pace in China and the turbulence generated by the shift in us monetary policy, are added to the tensions, protectionist, with impacts becoming more evident in some of the powers exporters such as Germany. The forecasts for the eurozone have been reduced, to 1.8%. The diagnosis coincides with that of the panel of Funcas analysts of the Spanish economy, whose barometer has detected deterioration of the winds outside of a tail, especially coming from Europe.
In this context, the IMF regrets that in its follow up report on the Spanish economy the limited progress since the start of the recovery in the correction of the public debt and the reform agenda. The consequence is that there is barely mattress to cope with a worsening more intense than expected, but nothing is disposable, from the international context.
The international agencies are particularly strong in terms of the public deficit. If it is reduced it is only by the automatic effect of the high growth, and not by efforts of structure. All, Pasgol except the OECD, estimate that, in the absence of measures, the deficit will exceed the target of 1.8% of GDP. The European Commission, recently concluded his comparative analysis of the budget plans for 2019, noting that the imbalance in the accounts of the public Administrations Spanish would be the highest after Italy. These recommendations are consistent with the valuations of the majority of analysts participating in the panel, when it considered that the fiscal policy is still expansionary.
there is Not a single recipe to reduce the deficit —that is one of the lessons of the international crisis that has most contributed to the volatilization of the so-called Washington Consensus—. The OECD recommends improvements in the structure of public expenditure, for example, by focusing social spending on the most vulnerable groups and reforming pensions for indiciarlas about the longevity. It also advocates for an increase of green taxes and a reduction of breaks in the VAT, starting with the most regressive, something that matches the IMF. The European Commission considers that the revenue collection capacity of the measures in the fight against fraud and the new formulas tax contained in the project budgets (tax digital and on financial transactions) is limited, and has also questioned the pension adjustment on inflation.
on the other hand, the international agencies celebrated the high rate of growth in relation to the main european economies, as well as the forces that are driving —dynamics investor, loop-the-job consumption, competitive position—. They also recognize the significant progress in the internationalisation of the productive fabric. However, they regret the impasse of reforms that has hit the country since a few years ago, but discussed different options and insist on the importance of equitable. Show unanimous in advocating for a reform of the labour market, but with important nuances about how to get it. The OECD is the most favourable to the increase of the minimum wage, for their positive impact economic and social.
What is this look international suggests is that, until now, the economic boom is not fully exploited to plant the foundations for a prosperous economy and inclusive. However, there is still a window of opportunity for reform with equity, and to correct the deviations in the budget. And thus strengthen the resilience to the turbulence that lay ahead.
Raymond Torres is the director of the Joint at Funcas. On Twitter, @RaymondTorres_
