Goldman Sachs praises Spain's economy: quality growth or mirage?
Goldman Sachs praises Spain's growth, but the data show productivity in only 20% of the economy and debt growing at 5%. Quality growth or a mirage?
English · Original discussion in Spanish · Published
Goldman Sachs praises Spain's economy: quality growth or mirage?
Goldman Sachs has just published a report claiming that the Spanish economy "is growing three times faster than Europe's, with quality gains, not just quantity". But scratch the surface a little and the shine fades.
The investment bank highlights the improvement in labour productivity and fiscal soundness, but omits that this increase is concentrated in professional services, finance and IT —barely 20% of the productive fabric— while the remaining 80% is still stuck in hospitality, low-cost construction and call centres. It is like bragging that the engine runs smoothly while the wheels are square.
Another blind spot: debt. While GDP is growing by around 2%, borrowing is advancing at 5%, a gap that smells of growth financed with more liabilities. Add to this mass immigration which, according to Goldman itself, "is putting pressure on the housing market", but which in reality is being used to inflate the active population figures without translating into quality employment.
The paradox is that the "growth" touted by the macro figures coexists with endless waiting lists, soaring housing prices and an ever more expensive shopping basket. As one analysis puts it: if you grow at 2 but borrow at 5, and on top of that most people's quality of life does not improve, maybe the word "growth" does not miccionan what it seems.
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Goldman Sachs has just published a report claiming that the Spanish economy "is growing three times faster than Europe's, with quality gains, not just quantity". But scratch the surface a little and the shine fades.
The investment bank highlights the improvement in labour productivity and fiscal soundness, but omits that this increase is concentrated in professional services, finance and IT —barely 20% of the productive fabric— while the remaining 80% is still stuck in hospitality, low-cost construction and call centres. It is like bragging that the engine runs smoothly while the wheels are square.
Another blind spot: debt. While GDP is growing by around 2%, borrowing is advancing at 5%, a gap that smells of growth financed with more liabilities. Add to this mass immigration which, according to Goldman itself, "is putting pressure on the housing market", but which in reality is being used to inflate the active population figures without translating into quality employment.
The paradox is that the "growth" touted by the macro figures coexists with endless waiting lists, soaring housing prices and an ever more expensive shopping basket. As one analysis puts it: if you grow at 2 but borrow at 5, and on top of that most people's quality of life does not improve, maybe the word "growth" does not miccionan what it seems.
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Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (14 replies).
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