Pedro Sánchez: "We want to again be the best economy in the world in 2025"

Madrid

The President of the Government of Spain, Pedro Sánchez, said today, at the closing of the 15th edition of the 'Spain Investors Day' forum, that the Executive wants Spain to again be "the best economy in the world" in 2025, after having achieved this milestone in 2024, according to the weekly magazine 'The Economist'. He also announced the creation of a Strategic Investment Committee and encouraged investors to invest in Spain and its "win-win" model.

Pedro Sánchez has celebrated Spain's "180-degree turnaround" in economic matters in recent years, going from occupying a front page in 'The Economist' in 2012, which reflected "a country wounded" by the consequences of the financial crisis, to one that now highlights that it is "the best economy in the world in 2024", as he said during his speech at the closing ceremony, which was also attended by the Secretary of State for Trade, Amparo López, and the president of the forum, Benito Berceruelo.

In this regard, he stressed that institutions such as the OECD, the IMF and the European Commission have praised Spain's economic performance and point out that "our country leads growth in the developed world and has much more favourable future prospects than other neighbouring countries." Indeed, AIReF has raised its growth forecasts for Spain to 3.1% for 2024 and 2.5% for 2025. "The Spanish model works, something we have to call for and be proud of, and it is a model for other countries to follow and imitate." "Our ambition, which has led us to this milestone in 2024, is that we also want to be the best economy in the world again in 2025. Let's go for it," he emphasised.

A "virtuous triangle" of growth and progress

The factors behind this remarkable economic progress are the recovery from the pandemic and an "appropriate and ambitious economic policy, with which we are sowing the seeds of strong and sustainable growth," he said. The pillars that underpin the basis of Spain's successful economic model and that form a "virtuous triangle of growth and progress" are, he said, the transformation and modernisation of the productive fabric, openness to the outside world and a sound financial situation.

On productive transformation, he pointed out that Spain closed 2024 with growth of over 3%, more than double that of Germany, France and Italy, and it is estimated that growth will continue to exceed 2% until 2026, once again among the highest of the large EU economies. This remarkable growth is taking place in parallel with the reduction in inequality, according to the latest report by the International Labour Organization, which places Spain as one of the advanced economies with the lowest wage inequality, "largely thanks to the effort, also made by employers, linked to the increase in the minimum wage."

Thanks to the Government's firm commitment to innovation, the roll out of technology in SMEs and the development of cutting-edge sectors, he stressed that high value-added activities, such as technology, telecommunications or professional and financial services, represent more than 18% of the economy, and those linked to environmental protection, 3%. "The Government of Spain will continue to act with the highest ambition: to make human capital formation the basis of our present and future prosperity," he added. In order to attract talent, he pointed out that in the last six years, public investment in education has increased by 38%, more than 300,000 vocational training places have been created and the supply has been updated to meet demand - four hubs will be created linked to the environment, technology and the aerospace and railway sectors. Public spending on science and innovation has grown 50%, progress is being made in cybersecurity and Spain is leading Europe's green hydrogen projects, among other achievements, which "would not have been possible without the contribution of companies, workers and investors."

Group photo of the 'Spain Investors Day' forum | Pool Moncloa/Borja Puig de la Bellacasa

Spain, top 10 worldwide in foreign investment confidence

The economic transformation is also due to the NextGenerationEU funds, which already reach more than 637,000 SMEs, added Pedro Sánchez, who pointed out that the number of companies with more than 250 workers is increasing at a rate of more than 6% per year. "There is extraordinary confidence in the possibilities and potentials of our economy," he emphasised. Spain is in the top 10 worldwide in terms of confidence for foreign investment, thanks to "key assets" for business competitiveness, such as advanced infrastructures, potential for self-sufficiency in clean and cheap energy, and a broadband and 5G network deployed throughout the whole country.

Achieving full employment by the end of the legislature

He also referred to the record figures for the tourism sector for 2024, published yesterday, which reflect the milestone of 94 million visitors and spending of more than 126 billion euros, although he specified that the Government's objective is "to grow in order to progress and improve the lives of citizens." In the last six years, and with two crises in between, he stressed that 2.4 million jobs have been created and unemployment has fallen to its lowest since 2008. The Government aims to achieve full employment by the end of the legislature with a model that "furthers purchasing power and allows for the reconciliation of work and family life," he confirmed.

Openness to the outside world and sound public finances

As for opening up to the outside world, he emphasised that it is "ever greater and deeper," going from being "an importing country to a great exporting country." In fact, four out of every ten euros of the revenue the country generates comes from what it sells to the rest of the world and it exports goods and services worth almost 600 billion euros, almost 70% more than a decade ago, with a historical foreign surplus of 3.4%. Furthermore, the "extraordinary performance" of the foreign sector is evidenced by the increase in market share in European and world trade, and the greater diversification of exports, with a growing weight of non-tourism services (7.5% of GDP in revenues), and the number of regular exporting companies.

However, he indicated that a greater commitment must be made to strategic autonomy and to "reindustrialise" the continent. In this regard, he pointed out that energy independence is six points higher than in 2018 and the forecast is to reach 81% renewable electricity by 2030, with a saving of more than 85,000 million euros in fossil fuel imports in a decade. In addition, Spain is positioned as a global hub for access to markets such as Europe, Latin America and North Africa. All in all, the stock of foreign investment has increased by more than 33% between 2018 and 2022 and represents 40% of GDP, ahead of Germany or France.

Finally, the third factor of the "virtuous triangle" is the country's healthy financial position, said Pedro Sánchez, with households and companies that "spend and invest but save more than in previous expansionary phases" and an "extraordinary health" of the banking system and public finances. The European Commission has endorsed the Government's fiscal plan and Spain will end 2024 with a deficit of 3% of GDP, and the public debt ratio has fallen by 20 percentage points since the peak of the pandemic. The "possible" objective is that, by the end of the legislature, in 2027, public debt should be below 100% of GDP without compromising the quality of public services, he stated.

The President of the Government of Spain, Pedro Sánchez, together with the Secretary of State for Trade, Amparo López | Pool Moncloa/Borja Puig de la Bellacasa

Establishment of a Strategic Investment Committee

The head of the Executive added that the success of the policy is also reinforced by social peace, political stability despite the "interested noise" and Spain's "extraordinary" security, although he added that "there is still a great deal to do," such as "modernising and boosting the construction and housing sector, being more productive, innovating more and better and continuing to invest in human talent." For this reason, he announced the creation of a Strategic Investment Committee to provide companies with "a stable and facilitating framework" to undertake investment decisions in strategic projects. The new body will be responsible for identifying needs and guiding investment priorities in digitalisation, innovation and green transition, and for accelerating projects with the greatest impact and relevance for the economy and the territory. "It responds to the request to speed up the procedures and bureaucracy, which in many cases paralyses important investment projects," he said.

Pedro Sánchez conveyed to the investors and businesspeople present at the event that "investing in Spain pays off" and the commitment to guarantee a regulatory environment that "generates certainty and confidence, to continue promoting an unparalleled infrastructure network and to seek not only understanding, but also complicity with the private sector to promote investment, generating value for both." "Invest in Spain if you believe in our country and our model, a model that we defend because it is a win-win model," he concluded, encouraging those present to invest throughout the country.

Non official translation