Spain fears another recession

Spain plans for “new normality”

Spain fears another recession 1The BBC report this morning that Spain has announced a four-phase plan to lift its stringent coronavirus lockdown and return to a “new normality” by the end of June.

Prime Minister Pedro Sanchez said each region would relax restrictions at a different pace, depending on the severity of its outbreak. Four Spanish islands will be first to ease measures from 4 May, with the rest of Spain following a week later.

Spain’s coronavirus outbreak has so far killed almost 24,000 people. However, daily deaths are now as low as 300, compared to over 900 at the beginning of this month.

In a model that could be replicated in Portugal, Spain plans to ease the following measures:

  • Small businesses including hotels will be allowed to open from May 11, but with social distancing remaining in force.
  • Some schools will be allowed to reopen late May, but most will stay closed until the new term begins in September – a similar decision has been made in Italy. In contrast, France plans to gradually resume school classes from May 11.
  • Restaurants can start opening their terraces from mid-May, but cannot be more than 30% full during the first phase.
  • Shops will be able to open at half capacity from the end of June, with two metres between shoppers.
  • Beaches are expected to reopen in late June, presumably with some restrictions.

The BBC describes Spain’s economy as being battered by the impact of the virus, with the Bank of Spain forecasting that unemployment could rise to 21.7% this year.

Recession of “extraordinary scale” now looming in Spain

Mr Sanchez said a recession of “extraordinary scale” was now looming, which would require an extraordinary response from the EU.

The country has recent experience of a recession, during the 2008–2014 Spanish financial crisis, also known as the Great Recession in Spain or the Great Spanish Depression, began in 2008 during the world financial crisis of 2007–08. In 2012, it made Spain a late participant in the European sovereign debt crisis when the country was unable to bail out its financial sector and had to apply for a €100 billion rescue package provided by the European Stability Mechanism.

3 thoughts on “Spain fears another recession”

  1. It’s not just Spain on a Recession path, it’s going to be Global!! The big question is : how each country is going to manage their Economy and come out in the other side with the most bold and responsible measures!

    Reply

Leave a comment

Translate »