Spanish vice president Elena Salgado continues to ignore analyses of the Spanish economy conducted by firms deemed more equitable than her outgoing Spanish government. Yesterday the European Commission added to the endless stream of voices ruling out Spain´s chance for complying with their growth predictions. It projects Spain?s GDP to grow by 0.8% for this year. Yet Salgado and her cabinet are still fighting tooth and nail to see Spain?s hit their 1.3% target.
The EC warns that the global macro environment and widespread uncertainty will affect our growth. It is surprising that after her calculations have been proven wrong time and time again, Salgado continues to reiterate the 1.3% figure without making any adjustments.
Especially when the Ministry of the Economy has run sensitivity tests and has recognized that the 0.8% level is a possible scenario.
The situation gets increasingly fuzzy as the possibility increases that unbalanced public accounts do not go over the 6% needed to meet the deficit renewal schedule set by the EU. Justifiably, this week Moody?s warned that the Spanish regional governments are a liability in this battle.
If our GDP does not grow by 1.3%, as seems to be the case given our stagnant economy, the 6% misalignment will be a chimera, making it all the more urgent to reinstate the estate tax. The federal government does not have time to arbitrate more fiscal measures that would reconfigure their accounts. The early election could have been earlier still, and November 20 still so far away.
