- 1Spain: An attractive country for investment
- 2Setting up a business in Spain
- 3 Tax System
- 4 Investment aid and incentives in Spain
- 5 Labor and social security regulations
- 6 Intellectual property law
- 7Legal framework and tax implications of e-commerce in Spain
- AI Annex I Company and Commercial Law
- AIIAnnex II The Spanish financial system
- AIIIAnnex IIIAccounting and audit issues
- The country, its people and quality of life
- Spain and the European Union
- Economic structure
- Domestic Market
- Foreign trade and investment
- Legislation on foreign investment and exchange control
- Obligations in relation to anti-money laundering and counter-terrorism financing
The structure of the Spanish economy is that of a developed country, with the services sector being the main contributor to GDP, followed by industry. In 2021, these two sectors represented more than 91% of Spain’s GDP, with agriculture’s share today representing 2.96% of the total GDP, having declined sharply (see Table 4).
Table 4STRUCTURE OF GDP (% OF TOTAL, CURRENT PRICES)
|Agriculture and fishery||2.86%||3.45%||2.96%|
Throughout 2020 the impact of the COVID-19 public health crisis was felt by the Spanish economy due, principally, to the implementation of measures to contain the pandemic. This entailed a major change with respect to the growth trend which began in the second half of 2013. Nonetheless, during 2021, the GDP growth rate substantially improved, recording a variation of 2%12 in the quarter-on-quarter rate in the fourth quarter of 2021 in terms of volume. Year-on-year growth in GDP amounted to 5.2%13, reflecting a recovery of the Spanish economy and corresponding to the highest growth figure in the last 21 years. The GDP growth rate is expected to remain high in 2022.
Inflation in Spain had been gradually falling since the end of the 1980s. Average inflation between 1987 and 1992 was 5.8%; it dropped below 5% for the first time in 1993, and it has been shrinking gradually since then. For reference, the year-on-year inflation rate at December 2020 was -0.5%. However, 2021 saw a change in the inflation trend, due mainly to an upsurge in demand following the restrictions introduced as a result of the pandemic, leading to mismatches between supply and demand as a result of shortages of raw materials, particularly energy products.
This generalized increase in prices was reflected in a year-on-year inflation rate of 6.7% at the end of 2021, driven mainly by the rise in energy prices. Despite the sharp change in trend, inflation growth is expected to slow throughout 2022, bolstered by favorable financial conditions and the inflow of funds from the European Recovery Plan, although the impact of the Russian invasion of Ukraine has increased uncertainty as regards its evolution, due to the price of energy products.
Table 5GROWTH FOR OECD COUNTRIES (%)
Real GDP Growth
|Total Euro Zone||1.8||-6.1||5.6|
12National Institute of Statistics, Quarterly National Accounts of Spain. Principal Aggregates. Fourth Quarter of 2021.
13National Institute of Statistics, Quarterly National Accounts of Spain. Principal Aggregates, Fourth Quarter of 2021.