As est

March 2015

The economy

ESPA
SPAIN
GDP, consumption and investment
2014 ended with a growth in GDP of 1.4%
and an increase of 2% year-on-year in the
fourth quarter. The acceleration is based on
the recovery in consumption and investment.

With regard to R&D spending, it dropped

2.8% (by -3% in the public sector and -2.7%
in the companies), finishing at 1.24% of
GDP, below the European target of 2% for
2020.

Private consumption grew 0.9% in the

fourth quarter, reaching a year-on-year
growth of 3.1%. By contrast, public spending, with nine straight months of decline,
dropped by 1% in the last quarter of the
year.

EUROZONE

Between 2008 and 2013, the accumulated

reduction was:

Use of Greek rescue funds

Use of Greek rescue funds

% of the total = 254,900 million euros

31,9%

Development of financing for R&D

during the crisis
16
12
8
4
0
-4
-8
-12
-16
-20

18,9%

14,3

Repayment of debt

Variation in % 2008-2013

18,0%

15,9%
10,6%
Government
spending

Spanish R&D
The most recent report from the Cotec
Foundation about the Spanish research and
development sector in 2013 reveals a drop
of total investment in R&D, both public
(-5.7%) and private (-1.5%). For the first
time, private financing of R&D is greater
than that in the public sector.

In addition, the INSEE points to the positive measures of the Frances Pact of Responsibility, outstanding among which are
the tax benefits to increase hiring, which
could create 80,000 jobs in a year while also
improving company profits and investment.

Interest payments

Investment in capital goods: 1.9%

(10.3% year-on-year).
Investment in construction: 1.4%, for
three consecutive periods of growth.

Capitalization of banks

This improvement will come from a drop in

the price of petroleum and lower taxes,
which is stimulating consumption and
economic activity throughout Europe.

Buying debt

Total investment increased 1.4% between

October and December, in the following
ways:

France improves consumption

For 2015, Frances INSEE (National Institute of Statistics and Economic Studies)
predicts a growth in GDP for the Eurozone
of 1%, with an increase of 0.3% in each of
the first two quarters to achieve 0.7% by
mid-year.

3,8%
IMF
0,9%
payments ESM capital

Source: Macropolis

-8,7

-11,5
TOTAL

Source: COTEC

-17,1
Public

Private

Foreign

According to data from Yiannis Mouzakis

(of the Macrpolis think tank), 51% of the
funds that Greece has received from the

www.circulodeempresarios.org

Eurozone and the IMF will go to paying

back national debt:

31.9% (81,300 million) at expiration of

notes and bonds;
15.9% (40,600) to interest;
3.8% (9,600) to paying the IMF.

Likewise, 18.9% (48,200) was used to recapitalize financial institutions, 18% for the
purchase of debt (45,900) and 10.6%
(27,000) for the operational needs of
Greece.

In the case of China, its debt quadrupled

between 2007 and 2014 (from 7.4 bn $ to
28.2 bn $), fundamentally in the real estate
sector (50% of the loans) and in shadow
banking (50% of the new loans). While this
level of debt is not among the highest, it is,
at 282% of the GDP (including financial
institutions), above that in Germany (258%
of the GDP) and the USA (269% GDP).
Debt. Top 10 advanced and
developing economies

% GDP, excluding financial sector

Economas avanzadas
Japan
Ireland

INTERNATIONAL

Singapore

Global debt
According to the McKinsey Global Institute report Debt and (not much) deleveraging
(February 2015), between the start of the
economic crisis in 2007 and 2014, global
debt (of the 47 countries analyzed) has
grown by 40%, 57 billion dollars (17 points
of the GDP), principally in the advanced
countries and because of the public sector.
Global debt

199

Bn $

40

Families

142
33

87
19
26
22
20

4T2000

56

Non-financial
companies

38
58
33
37

Public sector

45
Financial sector

4T2007

2T2014

Source: McKinsey Global Institute

Ireland (+172 p.p.), Singapore (+129 p.p.),

Greece (+103 p.p.), Portugal (+100 p.p.),
China (+83 p.p.) and Spain (+72 p.p.) are
the countries where the total debt (not
counting the financial sector) has grown
the most.

Belgium
Netherlands
Greece
Spain
Denmark
Sweden
Italy

Developing economies

Hungary
400
Malaysia
390
China
382
Thailand
327
Israel
325
317
Chile
313
Poland
302
South Africa
290
Czech Rep.
259
Brazil

225
222
217
187
178
136
134
133
128
128

Source: McKinsey, 2015

Japan
The Japanese economy is growing again
following the increase of the VAT in April
of 2014 (from 5% to 8%), a move aimed at
reducing public debt (from 230% of GDP at
the end of 2013) and guaranteeing the continued financing of social security. Preliminary data from the government indicates an
advance in GDP in the fourth quarter of
2014 of 0.6% quarter-on-quarter and of
2.2% year-on-year, with the result that the
countrys economy is coming out of its
fourth recession in the last six years.
This upturn is largely explained by an increase in exports (2.7% quarter-onquarter), which have been favored by the
weakness of the yen and by greater demand
from overseas, especially the US and the
rest of Asia.
By contrast, domestic consumption, which
accounts for 60% of the economy, only increased by 0.3%. Public investment grew
0.6% and private investment by 0.1%.

As estThe economy, a publication of the Crculo de Empresarios produced by its Department of the Economy, contains information and opinion from reliable sources. However the Crculo de Empresarios does not guarantee its accuracy and does not take
responsibility for any errors or omissions. This document is merely informative. As a result, the Crculo de Empresarios is not
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