During 2006, according to the latest issue (64) of the Navarre Economic Outlook Bulletin, presented last week by the Vice President of the Government and Minister of Economy and Finance, Francisco Iribarren Fentanes, trade flows in the Navarre region showed a significant acceleration. In fact, growth rates in trade increased by 12,1% for exports and 19,1% for imports.
Regarding purchases from foreign countries, the document issued by the Navarre government specifies that the sharp increase in imported car purchases (37,6%) must be taken into account. These cars enter through Navarre and are destined for other Spanish regions. Excluding these imports, total imports increased by 15,8%.
Overall, the regional economy showed a high degree of growth at the end of last year. From a supply perspective, this was supported by the recovery of industrial sectors and the further intensification of the already strong expansion in the construction sector, which more than offset the slight moderation in the robust growth trajectory of the services sector and the notable weakness of the agricultural sector.
Leading Spain and Europe
Navarre's Gross Domestic Product (GDP) in the fourth quarter of 2006 was 4,1% higher than in the same period of 2005 and two-tenths of a percentage point higher than in the previous quarter. The growth rate for the year as a whole reached 3,9%, six-tenths of a percentage point higher than the estimate for 2005, despite the slightly lower results achieved up to June. The acceleration of the expansionary trend in economic activity likely allowed the regional labor market to continue showing positive performance, judging by the improvements in employment and hiring and the reduction in unemployment.
On the other hand, Navarre's GDP remains one-tenth of a percentage point above that of Spain and around eight-tenths of a percentage point higher than the Eurozone average. In annual terms, Navarre and Spain's growth rates were the same, exceeding the Eurozone estimate by 1,1 percentage points.
Furthermore, in December, inflation in Navarre fell to 2,1% year-on-year, down from 3,7% the previous year, a steeper decline than in the rest of Spain. The provisional closing of the 2006 General Budget of Navarre shows a positive balance of €102 million, as well as a surplus of €270,2 million in non-financial operations, equivalent to 1,7% of the regional GDP. The increase in revenue, which outpaced the increase in expenditure, was driven by strong tax revenue.
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