2024-03-25 14:48:41
Just when fiscal rules are resumed after the pandemic break, the Community Executive has asked our country to make an “additional effort” to guarantee a “significant” reduction of both the high levels of public debt and the structural deficit.
“An additional consolidation effort is necessary for Spain to achieve a healthy budgetary position,” warns the document that asks Spain for a “credible” fiscal strategy after Brussels considers that political action has been “limited” in recent years.
According to the economic forecasts of the European Commission, public debt will decrease this year to 106.5% while the deficit will stand at 3.2%, still above the Stability and Growth Pact which sets 3%.
Brussels recognizes that both Spanish public and private debt have declined in recent years since they began their downward path in 2013, which was interrupted by the pandemic in 2020 and then resumed in 2022. Brussels expects that the adjustment will continue in the years. coming years but in a much more gradual way because economic growth will be lower.
Although the European Commission trusts that tourism and exports will contribute to the prosperity of the economic economy and, therefore, to reduce debt in the coming years, it also warns that “the long-term evolution of the public debt ratio However, it is subject to more risks, due to its starting level and the still high structural deficits (not subject to economic growth) of recent years.
If in recent years the Government of Pedro Sánchez has relied on the decrease in public debt on the rise in GDP and the good results of the labor reform, now this is not enough. For this reason, the document published this Monday emphasizes that “it will be necessary to reduce the structural deficit” and address “future budget pressures on the spending side related to the aging of the population, as well as health and long-term care.” ” and ensures that “the application of a credible consolidation strategy” can complement the beneficial results of the reforms undertaken within the recovery plan to access European funds.
Brussels highlights as positive the good evolution of employment from 23.7% at the end of 2014 to 11.8% in the last quarter of 2023. The European Commission also praises the measures implemented within the plan to access aid post-pandemic European measures, among which access to financing by SMEs and debt restructuring of companies stands out. The community executive also highlights attempts to reduce dependence on energy imports and improve the competitiveness of the services sector.
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