Catalonia has been gaining labour productivity over the last ten years, as it has a GDP that is now 6% larger than before the long economic crisis, and a per capita GDP that is 1% higher - while the number of jobs is still 5% lower than the pre-crisis era. As well, the Catalan economy has resisted the new global deceleration, despite being more exposed to the evolution of foreign markets.
These are among the conclusions of the annual Economic Report on Catalonia 2018, produced by the Catalonia Council of Chambers of Commerce, Industry, Services and Navigation, and presented on Friday at Barcelona's Llotja de Mar palace, in the presence of Catalan president Quim Torra and leading figures in the Catalan business community.
The report, available in Catalan here, says that 2018 was a good year for Catalonia in economic terms, with last year's GDP growth being above average compared to the main countries in the euro zone. That growth rate has now slowed down, but no faster than neighbouring economies. It could, however, have a growth rate below the overall Spanish average in 2019, again due to its greater exposure to foreign trends.
Internationalization, employment and growth
The study, presented by its director Carme Poveda, shows that, compared to the main countries of the euro zone, Catalonia was in the high band in the GDP growth rate in 2018, and that, despite being a very open economy and exposed to the instability of foreign markets - with a trade openness ratio of 71% in 2018, ten points ahead of the Spanish economy - it has not slowed down any more than the rest of the economies in its neighbourhood, "a sign of high competitiveness in its export sector".
Poveda pointed out that "the economic dynamism of the last 5 years has made it possible for Catalonia to now be generating a GDP five percent greater than in 2007", and that more than a decade after the crisis it is "generating 6% more activity with 5% less employment, a signal that it has gained in labour productivity."
The report also underlines the factors that explain the growth of the Catalan economy in 2018, pointing especially to the strength of domestic demand, a high positive trade balance, the growing internationalization of the business fabric and the fact that the most dynamic sectors are those focused on knowledge, such as digitization and new technologies.
Oriol Amat, dean of Pompeu Fabra University's Barcelona School of Management, stated "Catalan enterprises since 2008 have been improving their debt and financial situation", so that in the event of a new difficult era, they could overcome it better. "Those companies that were highly indebted before the crisis have died, and those who were not, have been able to overcome it much better. Now businesses here are tending to be less and less capitalized," he asserted.
In addition, "in financial terms, Catalan companies have very good profitability, due to business dynamics, internationalization and sales." As weak points, Amat mentioned the political climate and the lack of investment in R&D, which he explains, "is the key to addressing all the challenges we have."
Despite the general dynamism of the Catalan economy, the report warns that some challenges must be faced, such as increasing effort in research and knowledge, in which Catalonia invests only 1.47% of its GDP, still below the EU's 2.07% average; and it should also reduce its long-term unemployment rate at the same time as it increases wages and productivity.
In addition, the report stresses the need to achieve sustainable growth by 2030 through the fulfillment of the UN Sustainable Development Goals, which aim to fight poverty, curb climate change, improve public health and the quality of work, as well as reducing gender inequalities, among others.