Analysts from various policy institutes agree for the most part that the Spanish economy will improve and grow by around 1% in 2014. But they also warn that the crisis is not over and that we should remain prudent. Especially because we are very vulnerable and any setback, whether from a domestic or foreign source, could cause a serious problem.
Spain still has a high national debt and annual deficit, rampant unemployment, clogged credit markets and political problems with the Catalonia region. Even though credit should start flowing this year, jobs will follow slowly because companies have cut their payrolls to weather the crisis and recovery. In order to reach the next part of the business cycle -- when job creation finally happens -- the government needs to finalize pending reforms.
