Spain's Economy Surges Past Eurozone Rivals Amid Tourism Boom
Spain's economy grew by 3.2% in 2024, surpassing forecasts and outperforming its eurozone counterparts. Growth was driven by tourism, agriculture, and exports. However, rising living costs and a potential slowdown in Europe may impact future growth. Spain's fiscal stability adds resilience against global economic challenges.
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Spain's economy has defied expectations, expanding by 3.2% in 2024 and outpacing its eurozone neighbors, according to preliminary data from the National Statistics Institute. This robust growth led the Spanish government to consider revising its forecast from 2.4%, buoyed by a surge in tourism, agricultural output, and exports.
Consumer spending, falling unemployment, and increased investment are anticipated to sustain economic momentum, as noted by brokerage Jefferies. Immigration has also played a pivotal role in closing skill gaps and reducing unemployment to a 16-year low, thereby supporting GDP growth.
Despite the positive indicators, challenges such as rising costs of living and a housing crisis are impacting living standards, cautioned Natalia Aguirre, head of strategy at Renta 4 brokerage. Additionally, Spain's economy could face hurdles if slower growth persists across Europe, potentially affecting exports in 2025.
(With inputs from agencies.)