Oviedo (EFE).- BBVA Research has raised its growth forecast for the Asturian economy for this year from 0.6 to 1 percent, in line with the upward revision carried out for all the autonomous communities, although the Principality would register the lowest growth across the country.
Looking ahead to 2024, the experts from this research service have lowered their growth forecast for the Principality’s Gross Domestic Product (GDP) by one tenth, from 3 to 2.9 percent, which, however, would place the advance of the Asturian economy three tenths above the national average.
For the country as a whole, the entity has raised its growth forecast for 2023 by four tenths, up to 1.6 percent, while at the same time it has lowered its estimate for 2024, in this case from 3.4 to 2.6 percent.
In its latest report made public this Wednesday, the entity improves the growth forecast for this year in all the autonomous regions, since “there has not been a contraction in activity due to the rise in energy prices”, while “the bottlenecks are disappearing” and “growth forecasts improve in the global environment and domestic demand is supported by savings accumulated in the pandemic and some public policies.”
Benefit for part of the industry
This analysis also indicates that the rapid correction in fuel prices, together with the progressive disappearance of supply and demand restrictions, will benefit different parts of the industry, which will favor to a greater extent regions with a significant weight in the automotive sector. , machinery and equipment, the textile sector, and food.
BBVA Research exposes that the reduction in the price of energy, transport and imported inputs will benefit the economies of the communities linked to the industry this year, especially Navarra (+0.9 percentage points), Galicia (+0.6 pp ), the Basque Country, Castilla y León and Catalonia (+0.5) and the Valencian Community (+0.4 pp), regions closely linked to the automotive sector.
In this regard, he points out that “the disappearance of the bottlenecks” could boost the growth of registrations this year by more than ten points.
The rest of the communities more focused on the production of other goods “could see a somewhat slower recovery”, which translates into smaller GDP revisions in La Rioja, Cantabria, Madrid and Asturias, while the drought weakens progress in the south , adds the report, which specifies that “to this we must add the growth that investment linked to European funds can bring about.”
Tourism boost
In addition, the recovery of European demand that leads to a rise in consumption by non-resident tourists will support growth on the islands, and urban tourism and that of fairs or businesses will also recover, which in communities such as Madrid or Catalonia are accelerating tourist spending mainly by foreigners, state the entity’s experts.
Regarding inflation, according to this study, the strength of the activity in 2023 will keep it high, which in 2024 could reduce the purchasing power of households and increase the costs of companies, something that, added to the rise in interest rates, threatens the recovery of consumption and investment.
Regarding the cut in forecasts for 2024, the report warns that the rise in interest rates will weaken the recovery of consumption, slow down tourism and cool investment.
