The Canary Islands will grow by 2.2% of GDP by the end of 2023

Spain's regions Extremadura, Catalonia, Castile and Leon, Cantabria, Asturias, Balearic Islands and Canary Islands will remain below 2019 values

The Foundation of Savings Banks (FUNCAS) has raised its growth forecasts for the Spanish Gross Domestic Product (GDP) for this year to 1.3%, so that the country will reach levels prior to the Covid-19 pandemic at the end of the year; however, the Canary Islands are still not expected to recover the figures of 2019, although it points to a growth of 2.2% of GDP at the end of 2023.

Specifically, up to 10 Spain’s autonomous communities will have recovered their 2019 GDP levels this year. Thus, Andalusia, Valencia, Madrid, the Basque Country and La Rioja will join Aragon, Castile-La Mancha, Galicia, Murcia and Navarre, which already achieved this in 2022.

However, Extremadura, Catalonia, Castile and Leon, Cantabria, Asturias, the Balearic Islands and the Canary Islands will continue below the 2019 numbers.

Six regions will grow above the national average: the Balearic Islands (+3.3%), the Canary Islands (+2.2%), Catalonia (+1.4%), Madrid (+1.4%), Navarre (+1.4%) and the Basque Country (+1.4%), while Andalusia (+1.3%) and Galicia (1.2%) will grow practically in line with the average.

At a press conference, the director general of FUNCAS, Carlos Ocaña, and the director of the Economic Situation and Statistics, Raymond Torres, explained that the main engine of growth will come from the stimulus of European funds and the normalisation of tourism activity, which will even exceed pre-pandemic levels.

Thus, regarding the effect of the Next Generation funds, the communities with the greatest presence of the capital goods industry and advanced business services, such as Catalonia, Madrid, Navarre and the Basque Country, could benefit the most from the use of these subsidies.

Asked about this increase in forecasts, since in January Funcas predicted a rise in GDP of 1% for 2023, they indicated that this change is due to the latest data available from the National Statistics Institute (INE), which have raised national growth.

In addition, they have assured that the general economic perception is “somewhat more optimistic” than at the end of December or the beginning of January, as the evolution of energy prices has changed and the perception of the risk of war in Ukraine has decreased “although it is still serious”.

Scroll to Top