Analysis of Spanish Economy

Topics: Unemployment, Economics, Economy Pages: 15 (5764 words) Published: December 7, 2012
International Economics - Spain

Somebody asked me the other day what happened with my country, Spain; why it is known by almost every young European person that it is so hard to find a job in Spain, and why is the Spanish economy so weak, with so much debt and with such high unemployment? Well, there are many reasons to explain the failure of the development of a stable and sustainable economic system of such an industrialised country, with so many resources and influences all over the world during the last 600 years, that it should appear as other rich and influential European countries, such as Germany, France or England; countries that are being world references in the exit of the crisis. The answer is so long that we couldn’t explain all the mistakes and structural problems that the directing class had committed in Spain during the last 20 years, even if we wrote them by bullet points! The result of all these mistakes is hard reality… Spain and its economic boost from 2000 to 2006 were known between the world economic environments as the “Spanish miracle”. Spain grew much faster than the other European top countries, its GDP grew between 3% and 4% each year, the unemployment decreased to even 6% - which for other countries may not be very strange, but for Spain, that historically has been very affected by unemployment, it was an unknown success - , and the consumption grew spectacularly, which lead to an economic launch where the majority of the Spanish that opened a business where achieving benefits. It is true that every developed economy that starts below the rest have usually higher rates of growth, just for a mathematical reason. But Spanish growth during these years was a surprise for everybody. The imports grew massively, Spanish banks where suddenly acquiring real international relevance, investors from all over the world dreamed with having as much money much capital as possible invested on the “Spanish miracle”; in 6 years Spanish nearly was having the same GDP per capita as France and Italy, historically totally unachievable… And was this due to the great effort of the authorities that developed a perfectly sustainable economic system, creating logic labour that was necessary for fulfilling the so highly productive Spanish sectors (like Germany or Netherlands)? Or it was due to stable growth, launched by the high qualification of studies of the new young Spanish generations, launched at the same time by the precisely effective educational policy? Or it was due to the rise of productivity of the sectors that “moved” the Spanish economy, where the high investment on RR.DD increased the competitiveness of such sectors, allowing at last the Spanish economy being competitive in such fields? No. None of this is true. None of this logical ways of thinking how a developed economy like the Spanish can achieve top European levels is correct. Spain failed on its educational policy; the 3 political changes during the last 15 years – from the left to the right, and again to the left –, where the two main (and nearly unique), have so opposite thoughts that it has been impossible to keep a coordinated and agreed policy. The right wing (PP) of J.M Aznar and the left wing of Gonzalez and the former president Zapatero have varied so much the educational policies that the system created is right now possibly the worse of Europe in efficiency, scholarship failure and high qualified professional formation. The few incentives that students had to continue their studies, added to the high salaries that workers without formation of the construction were paid, provoked the Spanish begging of the fatal imbalance; the economy based on the construction and the price floor. Many young people just left their studies and started working as simple bricklayers, which during these times where the “bubble” was inflating without stop, they were paid much more many professional qualified workers. Spain also failed on creating a...
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