Hard to believe that it is nearly 6 years since the ‘economic crisis’ hit Spain. Summer 2008, Spain won the European Championship, and the whole country was rocking. Here in Almerimar it seemed like every bar, cafe and restaurant was full for every match, particularly any involving Spain, France, Germany or England.
Tables were full, people were spending money on meals and ‘top shelf’ drinks ….. and then by Christmas it was doom and gloom.
Well actually it wasn’t totally, as many, the Spanish in particular, remained in denial about the depth of the crisis and the general perception was that ‘it will e over soon’
As we approach another major football tournament (2014 World Cup), with Spain having won an impressive three tournaments in a row – but only 4th favourites this time – it will be interesting to judge the state of the economy based on the support for the football.
To borrow (and modify) a well know phrase: do they think it’s all over?
The previous three tournaments have provided a good barometer for the financial health of this in Spain: while 2008 was one big, over indulgent party, by 2012 the group stages were sparsely supported and while the mood picked up throughout the qualifies it was beer and tapas only, a significant reduction on spend from the glorious 2008 days.
Spain still remains in denial: you only have to look at the over hyped statistics recently that Spain was recently 3rd in the Tourism Tables, and reported its best year for ages in terms of numbers (not spend please note) yet try and tell that to the businesses up and down the Costas that are struggling to make ends meet.
By far the best example of Spain’s denial though must be the fact they actually think the ‘glory days’ of pre 2008 were actually down to ‘things’ that they did. The reality is that Spain’s success was built on other countries strength: tourism (because people from other countries could afford to go on holiday), properties (because people from other countries could afford second properties abroad, because property developers were paying over the odds to satisfy perceived future demands making Spanish landowners rich – on land that had been in the family for years), export (red wine, almonds, olive oil – all ‘luxury’ products to countries with well off citizens).
Sorry, but Spain didn’t create it’s success: but success bread ignorance and a over confidence – no point getting a good education as can earn good money in construction, tourism, farming. No disrespect but not exactly intellectually challenging industries by tradition.
So Spain is left with a poorly educated (un) employed work force, and crumbing education system, and no real plans (or skills) to get themselves out of the mess.
Being 3rd on the Tourism Table sounds good, but other headlines tell a truer picture:
Spain recently reported its public debt soared to a new record high in 2013 despite a slew of budget-cutting measures, ballooning to nearly 94 percent of the economy’s entire annual output.
Prime Minister Mariano Rajoy’s conservative government has raised taxes, frozen public salaries and curbed spending on items such as education and health so as to rein in bulging annual budget deficits and the fast-accumulating state debt.
The austerity drive has sparked mass street protests.
Public debt in the eurozone’s fourth-largest economy leapt to 960.6 billion euros ($1.33 trillion) at the end of 2013, the equivalent of 93.9 percent of gross domestic product for the year, the Bank of Spain said.
That was up sharply from 884.7 billion euros, or 86.0 percent of GDP in 2012, the bank said.
The result? If Spain can end the year in the same state as it is in now I suspect they will have done well.
