The INE revises the GDP of the last two years upwards and advances the economic recovery to 2022

The National Institute of Statistics (INE) has revised upwards this Monday the GDP data for the last two years. Thus, the Spanish economy advanced 6.4% in 2021 – nine tenths more than what was believed until now – and 5.8% last year – three tenths more than what was thought.. A slight modification has also been made to the data for 2020, the year in which GDP fell by 11.2% and not 11.3%, as believed.

The new data changes the story about the economic recovery after the pandemic which, with this new information, would have already closed in 2022 and not in the first quarter of this year, as the previous figures indicated.. In total, the INE review has increased the 2022 GDP level by 1.5% compared to the previous record (gross, about 20,000 million euros more wealth) an update that reduces part of the gap that existed in the recovery Spanish compared to the rest of the eurozone countries.

However, despite the fact that the differences with neighboring countries have been significantly reduced, the new data provided by the INE continue to place Spain as the EU country with the lowest level of GDP in 2022 compared to what it had in 2019. last pre-pandemic year. The revision has been important compared to historical precedents, but it has been far from what some analysts expected, predicting an even greater rebound.

For the Ministry of Economic Affairs, led by Vice President Nadia Calviño, the new data “attest to the adequacy of the economic policy response applied during these years, as well as the effectiveness of the measures adopted.”. From the Department of Economic Affairs they add that the dynamism of the economy will also be maintained during 2023 and will allow Spain to be the country, within the large euro economies, that grows the most in this year.

The review that was announced this morning is part of the routine calendar of GDP updates that the INE undertakes periodically as it obtains new and more precise information on the years in question.. In this case, the changes mainly affect private consumption, which recovered more vigorously in both 2021 and 2022 than previously thought.. Wages also grew more strongly in 2022 than previously estimated.

In previous years, the review of growth data had brought few changes. However, the years immediately following the pandemic have been especially difficult to measure due to the interference introduced by covid.. Hence, the INE has undertaken more abrupt reviews than usual. Some were particularly notable, such as the one that occurred in September two years ago, which reduced the GDP growth announced for the second quarter by almost two points.

The statistical institute itself points out in the press release in which it released the new data that the revision “is not unique in the case of Spain, but has been observed in other neighboring countries that have already published revised figures for 2021”. Among them, the INE cites the Netherlands, which has revised its 2021 data upwards by 1.3 points, the United Kingdom (1.1 points) or Germany (six tenths).. While France has lowered it by four tenths.

Consequences: less deficit and debt

The new GDP data will have a direct effect on other indicators. And in macroeconomics, many of the most frequently used variables are measured in comparison with GDP, which acts as the denominator.. The deficit, the debt, the fiscal pressure…. They are just some of them.

For example, the upward revision of the GDP will cause the deficit and public debt data to be somewhat lower than previously believed.. Thus, the difference between income and expenses of Spanish public administrations in 2022 was actually 4.7% of GDP and not 4.8%, as previously estimated.. In the case of debt, the ratio over GDP is reduced from 113.2% to 111.6%, almost two points of difference that places Spain in a slightly more favorable position to face the adjustments that the return of European fiscal rules in 2024.