BBVA estimates that The Basque economy will grow by 2.8% next yearcompared to the 2% planned for the whole of 2024. In this way, the Basque autonomous community will register one of the highest growth rates in all of Spain with Navarre, thanks to the recovery of European demand, which will stimulate the rreactivation of exports and industry. Likewise, the research department of the financial institution predicts that the growth of GDP per capita in Euskadi between 2019 and 2025 could double that of the state as a whole.
Everything indicates that the situation that the Basque economy is going through, with an industry that has not managed to return to pre-pandemic activity levels, could change in 2025, according to the report ‘Situation of the Basque Country.2024 ‘ from BBVA Research. , presented by Miguel Cardosochief economist of BBVA Research for Spain, and by Martha Alonsodirector of the Northern Territory of BBVA in Spain,
According to the Basque Bank’s research department, Euskadi will grow by 2% this yearan increase almost three times higher than that of the euro zone (0.7%), but below the Spanish economy as a whole (2.9%). This less dynamism responds to the fact that “industry and sales of goods abroad are slowing down the progress of activity, limited by the weak demand from the main European countries, with investments which are not reactivated”, indicates the aforementioned report.
Growth could accelerate in 2025 to 2.8%, despite the expected moderation in Spain (2.4%), thanks to the recovery in European demand, exports and falling input costs. This rebound in growth in the Basque Country to 2.8% It will be one of the highest in the national team, along with that of Navarre. “If these forecasts come true, GDP per capita in 2025 would exceed the pre-crisis level by 4.8 percentage points. This progression is almost double that observed in the whole of Spain and the highest among the communities that started with the highest incomes in 2025. 2019″, assured Miguel Cardoso.
For its part, the unemployment rate will decrease to 7.1% on average in 2025 and it is estimated creation of around 35,000 new jobs over the whole of 2024 and 2025, covered mainly by immigrants.
Basque industry has still not returned to pre-pandemic activity levels, “even if in the third trimester there is a slight improvementincludes the BBVA report. Energy, on the other hand, rebounds but from very low levels. “The gradual disappearance of bottlenecks, the improvement in European demand and investments in Spain support the future recovery of the production of intermediate and capital goods and are key to the recovery scenario of the Basque economy” .
Regional exports fell by 0.2% in 2023 (-1.0% in Spain), and so far this year the decline has widened to 24.7%. This decline affects the main exporting branches. “In the short term, the reduction of interest rates, the stability of energy prices and the improvement of competitiveness and demand, both European and Spanish, will stimulate the recovery of exports and industry,” commented Cardoso.
Advancement of tourism
For its part, the tourism sector continues to gain market share in Euskadi. The arrival of foreign visitors to hotels in the Basque Country and their overnight stays have increased over the last 9 months at rates of 7%, respectively 1 and 2 points, lower than the national average. Despite this, The rate of increase in card spending is higher than the increase observed in Spain. So far this year, spending with foreign cards registered at BBVA POS has increased by 57% year-on-year, above the 27% observed in 2023. The weight of foreigners in spending in the region in 2023 (5 .0%) returned to 2019 levels, 3.5 points lower than that recorded nationally as a whole.
Despite the good forecasts for 2025, the future growth of activity in the Basque Country faces “a few bottlenecks which could moderate growth”, declared the boss of BBVA. Among them, The automotive sector faces a high degree of uncertainty linked to the transition to the production of electric vehicles.
Likewise, doubts remain as to the effect of immigration on productivity and their concentration in low-skilled jobs is worrying. “The new process of integration of immigrants into the labor market is occurring with lower rates of occupational segregation, thanks to the fact that their participation has increased in almost all professions,” the report says. “Improving incentives and reducing uncertainties and barriers that hinder productive investment are an urgent necessity for productivity to increase,” commented Miguel Cardoso.
