Experts once again improve their expectations for the performance of the economy in 2017, due to the strength of consumption, employment and exports

Economic Consensus, corresponding to the first quarter of 2017, prepared by PwC

Consumption, employment, exports, productive investment, financing conditions for companies and individuals, and even the international situation are all in a good position, which will continue at least until the end of the year, according to a majority of experts and managers.

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The pillars supporting the Spanish economy are evolving well and will continue to do so in the coming months. Experts and business leaders are, for another quarter, optimistic about the state of economic activity in the country and, even better, do not foresee any major economic downturns on the horizon, according to the Economic Consensus, corresponding to the first quarter of 2017, which has been produced since 1999 PwC, based on the opinion of a panel of more than 350 Spanish experts, managers and businesspeople.

 

The cconsumption, employment, exports, productive investment, financing conditions for companies and individuals, and even the international situation They are experiencing a positive situation, which will continue at least until the end of the year, according to a majority of experts, executives, and business leaders. For example, 47,6% of those surveyed expect household consumption to increase in the next six months, and 55,2% anticipate an increase in housing demand. In both cases, optimistic opinions have grown compared to the previous quarter and have risen steadily, by more than twenty percentage points, compared to the beginning of 2016..

 

The truth is that Over the past twelve months, panelists' expectations have been improving substantially quarter by quarter. 66,7% estimate that job creation will continue to increase for the remainder of the year, levels of response not seen in the Economic Consensus since the first quarter of 2015. A similar situation exists with exports and productive investment, which will increase in the next six months, according to 59% and 48,6% of experts, respectively.

 

 

 

 

The Consensus describes an immediate future in which Companies will continue to operate under favorable financial conditions – according to 85,7% of the panelists. And where families, according to those surveyed, are gradually seeing their economic situation—savings, debt, wealth, wages—improving. This is further supported by an international context that, for the first time in a long time, is beginning to look more positive.

 

The international situation is improving

 

The panelists' opinion on the evolution of the world economy is shifting towards much more optimistic positions: The percentage of those who rate the global economic situation as good has increased by twenty-six points, to 56,1%, and the percentage who think it will remain this way in December of this year has grown to 70,4%. This shift towards optimism is particularly noticeable in the EU. where the percentage of experts who rate their current economic situation as good has risen by more than 25 points to 38%. The same is true for China and, to a lesser extent, Japan, while the outlook for the US economy also remains positive: 80% rate the current state of the American economy as good, and 82,4% expect it to remain the same or better by the end of the year.

 

 

However, the average opinion of the experts, managers, and business leaders who make up the Economic Consensus predicts a growth of the Spanish economy of 2,7% for 2017 and 2,5% for 2018. 80% expect GDP to be between 2,5% and 3% by the end of this year, in line with the forecasts of the Government and the main international organizations.

 

 

The panelists also don't foresee any major problems on the horizon. The main one, a possible spike in inflation, isn't a concern right now. 62,5% expect prices to remain between 2% and 2,5% in June and that, in the last six months of the year, they will moderate and move downwards, towards levels around 2%.Eighty-three percent of panelists believe the ECB will keep interest rates at 0% in the coming months, although their opinion is somewhat more divided when asked about December 2017: 40,9% believe they will remain unchanged, 25,7% believe they will rise by 0,05 percentage points, and 26,7% believe they will rise by 0,25 percentage points. Regarding the exchange rate, the majority opinion is that the euro/dollar exchange rate will remain between 1 and 1,1 dollars per euro until the end of this year.

 

What will be the future drivers of the Spanish economy?

 

This edition of the Economic Consensus includes a special report on the Reforms needed to activate and sustain the engines of growth in Spain, in which the panelists are asked which sectors they believe are best prepared to bear the brunt of the increased activity in our country over the next five years. According to 91,2% of experts, businesspeople and managers, the tourism sector will lead growth, followed by the automotive sector -58,2%- But alongside these sectors, which we could call traditional in our country, others immediately follow, such as Health, Transport and Logistics, Leisure and Culture, Professional Services or Information and Content, whose weight in the GDP will gradually increase.

 

Experts, managers, and businesspeople believe that the size of companies (Tourism, Industry, Transport and Logistics, Leisure and Culture, Professional Services)and the financing (Construction, Science and Technology and Collective Services), These are the main threats faced by the various sectors of activity in Spain. opportunities, digitization (Automotive, Financial Sector, Insurance, Transport and Logistics) and human capital (Health, Science and Technology, Education and Training, Leisure and Culture, Social Services to Companies) These are the ones indicated by a majority of experts (see chart).

 

The panelists predict that the Employment will grow in sectors that have traditionally driven the Spanish economy. –Tourism and Construction- as in those more emerging ones such as Health, Transport and Logistics, Leisure and Culture, and Information and Content. There are only two areas of activity where experts expect job losses, and those are the Financial and Insurance sectors.

 

66% of those surveyed believe that To facilitate the continued growth of the Spanish economy, sector regulators must adopt immediate reforms and measures. And it is striking that only 31% of the panelists say that the human resources available in Spain are adequate to sustain growth in the next five years.

 

 

 

Experts, businesspeople, and executives believe that The major disruptive changes that will have a significant impact on the growth of activity in Spain will be, in this order of relevance, artificial intelligence and robotization -66%-, 3D printing -64,9%-, telemedicine -62,3%- and the cashless economy -49,5%.

 

Juncker Plan

 

The panelists of the Economic Consensus They do not have a very positive opinion of the European Fund for Strategic Investments, better known as the Juncker Plan, devised by the EU to promote investment and boost the real economy. The majority are highly skeptical about its effects—only 25% believe it will help improve competitiveness in the EU—and 40,2% believe it has failed to revitalize the European project at a time of uncertainty. Furthermore, they believe that the companies most favored by the plan are not the smallest ones.