• Thu. May 30th, 2024

Spain meets deficit goal and finishes 2023 with 3.64% GDP.

Byeditor

Mar 27, 2024

Spain closed the 2023 financial year with a public deficit of 3.64% of GDP including financial aid, slightly lower than the provisional 3.66% reported last week by the Minister of Finance, Mara Jess Montero. The Ministry stated that the data changed minimally after receiving the definitive national accounting data, with the deficit standing at 3.65% excluding financial aid.

The Ministry of Finance has provided Eurostat with the official closing data, meeting and even surpassing the 3.9% forecast committed to the European Commission. This marks the fourth consecutive year that Spain has fulfilled its commitments to Brussels. The deficit reduction was attributed to economic growth, with Spain growing 2.5% in 2023, five times more than the euro zone average. Employment also played a significant role, with a record number of Social Security affiliates reaching 21 million employed individuals.

Despite the deficit reduction, Spain reinforced its Welfare State and social protections to combat the effects of the war in Ukraine. Since the start of the pandemic in 2020, Spain has reduced its deficit by over 60 billion euros while expanding public services. The Social Security system closed 2023 with a deficit of 8,627 million euros, equivalent to 0.59% of GDP, despite record contributions and increased employment.

The closing data for 2023 show a negative balance of 8,211 million euros, equivalent to 0.56% of GDP, for the Social Security Funds, which include the Salary Guarantee Fund (Fogasa) and the Spanish Public Employment Service (SEPE). Social Security received 43,908 million euros in transfers last year, showing a 2.8% increase. Overall, the Spanish financial landscape in 2023 displayed a mix of deficit reduction, economic growth, and reinforcement of social protections.

By editor

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