Spain’s economy slowed at the start of year, still on course for strong rebound, minister says

FILE PHOTO: The coronavirus disease (COVID-19) outbreak, in Madrid
FILE PHOTO: A woman wearing a protective mask walks past closed restaurants in Madrid, Spain, July 31, 2020. REUTERS/Javier Barbancho

March 22, 2021

MADRID (Reuters) – Spain’s economy showed clear signs of a slowdown in the first months of 2021 after a modest recovery in the fourth quarter of 2020, Economy Minister Nadia Calvino said on Monday at a conference in Bilbao.

Despite the slowdown in January and February, Spain will likely still post one of Europe’s fastest annual growth rates after suffering one of the region’s worst economic contraction last year, Calvino said.

“As a whole, the indicators speak of a slowdown in the months of January and February,” she said, adding that the picture was more mixed in March.

She pointed to higher electricity consumption and credit-card spending, as well as a reduction in the number of furloughed workers, as positive signs in March.

Her comments came a week after Bank of Spain Governor Pablo Hernandez de Cos warned that economic growth forecasts might have to be scaled back for the year.

The government has projected a 7.2% GDP rebound this year, while the Bank of Spain expects growth of 6.8%. Spain’s economy contracted by 11% in 2020, its worst full year on record.

(Reporting by Anita Kobylinska and Inti Landauro; Editing by Nathan Allen, Ingrid Melander)