Date post: | 13-Apr-2017 |
Category: |
Economy & Finance |
Upload: | circulo-de-empresarios |
View: | 86 times |
Download: | 0 times |
Quarterly report on the global
and Spanish economy
Q4-2016 and early 2017
Círculo de Empresarios
Madrid, January 2017
2017 GDP forecast
*ASEAN: Indonesia, Malaysia, Philippines, Thailand and Vietnam
Source: Círculo de Empresarios based on IMF 2017 and OECD 2016
2016 2017
Global
3.1 3.4
-3,3
-1,8
-0,8
US
Argentina
Brazil
EurozoneRussia
India
Nigeria
1.6
2.3
Spain
2.3
-3,3
6.5
7.2
4.9
ASEAN*
0.8
Japan
China
3
0.8
0.2 Mexico
1.7
2.7
2016 2017
OECD
1.7 2
1.9
1.1
Canada
South Africa
0.8
%
%
Upward revision from October
Downward revision from October
2016 relevant events
Source: Círculo de Empresarios, 2016 4
Higher volatilitydue to China’sdoubts + low
crude oil prices
Extension of theECB
expansionarymonetary policy
New deficitobjectives for
Spain
Brexit
The Bank of England cutsinterest rates
Mariano Rajoy isinvestedpresident
Donald Trump
January-February March April-May June-July
Brazil: Dismissalof Dilma Roussef
AugustSeptember-OctoberNovember
Concerns about
the italian banking
sector
Italian
referendum Donalds Trump’svictory
The Fed rises
interest rates
December
A year marked by political uncertainty...
2017 Trends
Source: Círculo de Empresarios, 2016 5
EU uncertainty
Electoral calendar, Brexit and banking system
Higher trade protectionism
Relationship between USA and Mexico, free trade
agreements (TPP, TTIP, NAFTA)...
“Soft landing” in China
Gradual deceleration of its growth combined with high
financial imbalances
Recovery of some emerging
economies
However, remain some risks associated to capital
outflows, currencies...
New US interest rates hikes and
inflation upturn
The Fed expects at least 3 hikes in 2017
Gradual recovery in commodity
prices
Gradual recovery of crude oil, metals...
Grey swans 2017
Source: Círculo de Empresarios based on Nomura Global Research, 2017 6
According to Nomura, grey swans are defined as unexpected events that will have a
significant impact upon the world economy(potential schocks)
Upturn in the
productivity of US
China might float its
currency
EU comprehensive reform
and UK re-join Increase of inflation in Japan and Abe
loses power
Emerging markets capital
controls
Change in the mandate of the Fed Taylor rule
Conflicts with Russia
Disappearance of paper money
After one year of global
slowdown, in 2017 economic
activity will recover its
dynamism
Source: Círculo de Empresarios based on OECD, 20167
Upturn of the global growth for 2017...
The global average growth in
the 19th Century is almost
3.5%
2016: Year of less growth since
the financial crisis
Forecast
3.34
-1
0
1
2
3
4
5
6
Real GDP growthAnnual change, %
Average C21th
4,74,3
3,5 3,4
4,2
3,2
2,1
0,4 0,3
2,3
0,0
1,0
2,0
3,0
4,0
5,0
2013 2014 2015 2016 2017
Emerging real GDPAnnual change, %
Emerging Emerging commodity exporters
...Mainly because of the improvement of some
emerging economies
Source: Círculo de Empresarios based on the World Bank, 20178
Forecast
Note: Brazil and Russia represent 40% of the emerging commodities export activity
Emerging countries will represent
60% global growth in 2017
After two consecutives years of
recession, Brazil and Russia will
recover the growth path
Emerging economies
Source: Círculo de Empresarios, 2017 9
Improvement of the economicperspectives
Trade recovery
Gains in stocks
Impact factor in emerging economiesCurrent situation
Donalds Trump’s economicpolicy
Price of commodities
Capital outflows and indebtedness in dollars
Key messages
RUSSIA
Source: Círculo de Empresarios based on Bankia Estudios, World Bank, 2017 10
Economic recovery due to positive external demand contribution and a more fiscal
+ monetary policy easing
2016
-0.6%
2016
+1.1%
Real GDP growth%
Growth below the 4.1% average previous
to the financial crisis (1995-2008)
Since 2014 maximum prices of crude oil to its minimum in February2016, the ruble has lost half of its value
Note: The correlation between crude oil prices and the ruble is greater than 90%
Inflation has dropped from 9.8% earlierthis year to 5.8% in December
20
30
40
50
60
70
80
90
100
110
120
Ja
n-1
4
Ma
r-14
Ma
y-1
4
Ju
l-1
4
Se
p-1
4
No
v-1
4
Ja
n-1
5
Ma
r-15
Ma
y-1
5
Ju
l-1
5
Se
p-1
5
No
v-1
5
Ja
n-1
6
Ma
r-16
Ma
y-1
6
Ju
l-1
6
Se
p-1
6
No
v-1
6
Ja
n-1
7
RUB/USD vs WTI evolution
Rubles per dollar Crude oil (dollars per barrel)
Latin AmericaAfter two consecutives years in recession, slowly economic recovery in 2017
Source: Círculo de Empresarios based on BBVA Research, 2016
+2%
Pacific Alliance: Chile, Colombia, Mexico, Peru
Mercosur: Argentina, Brazil, Venezuela, Paraguay, Uruguay, Bolivia
11
2016
2017
-1.3%
+1.3%
GDP forecast for Latin America
Pacific Alliance
%
2016 2017
+2%
-1.3% +1.3%
Risks for growth
Mercosur
Donalds Trump’seconomic policy
Pace of implementing
structuralreforms
Raw
Materials
Brazil and Mexico: Lights and shadows
Source: Círculo de Empresarios based on IMF, Bankia Estudios and BBVA Research, 2017
Brazil: Slowly climb out of recession
and modest growth for 2017
12
Growth drivers
• Less political uncertainty
• Confidence recovery
• Markets rebound
• Fiscal policy
Mexico: Instability due to futuretrade policy of Donald Trump
GDPPrivate
Consumption
Fixed capital
investment
-3.5 -4.3 -7.8
0.2 -0.3 4.6
% annual
2017
2016
First consequences
• Continuous review of growth
projections (1.7% in December vs 2.3% in October)
• Inflationary pressures* due to peso
depreciation (-20% since Oct-16 to Jan-
17) and “gasolinazo”
Note: The “gasolinazo” refers to price increases due to thereduction of subsidies in the gasoline
• Multinationals divestments
* 2017 estimation: 4,4% against the objective of (2%-4%)
(forecast)
• Social discontent
1,4
1,92,1
1,61,8
0
0,5
1
1,5
2
2,5
2013 2014 2015 2016 2017
Advanced-economies GDP growthAnnual change, %
Advanced economies accelerate at a slowly
pace
Source: Círculo de Empresarios based on the World Bank, 2017 13
0.9
1.7
2.3
3.2
Low productivity levels and aging pressures will reduce the potencial growth of developed
economies
Forecasts for the top GDP growth economiesAnnual change, 2017, %
.
Forecast
...And all in a global trade contracted
environment
Source: Círculo de Empresarios based on the World Bank, 2017 and OECD, 2016 14
In 2016, global trade growth registered its worst record since the financial crisis due to the fragility
of imports and the increase of protectionism, among others
-15
-10
-5
0
5
10
15
20
Exports and imports volume averageAnnual change, %
Global OECD Non-OECD
0
200
400
600
800
1000
1200
1400
2008 2009 2010 2011 2012 2013 2014 2015 2016
Number of trade restrictions measuresG-20 countries
0
20
40
60
80
100
120
140
Average lenght of economic expansions/recessions(months)
Expansion Recession
United States
Source: Círculo de Empresarios based on JP Morgan, National Bureau of Economic Research, 2016
8th consecutive year of economic growth, the third longest economic expansión
since 1900
15
1900 1920 19701940 1990 2017
*
* July 09- Jan-17
2.4 •2014
2.6 •2015
1.6
2.2 •2017
US real GDP growthAnnual change, %
2016
Note: 2017 economic growth does not include the posible expansionary fiscal policy of the new US Administation
(Forecast)
91
United StatesUnemployment rates diminished to its lowest levels (10% 4.7%)
+182,000 (Oct-Dec average)
4.7%(7.5 million)
Net employment creation Unemployment rate
Wages
+2.9%(December)
Source: Círculo de Empresarios based on BLS, BEA, 2016 16
Labor force
62.7%(66% in 2007)
Wage gains accelerated as US payrolls rise Labor force is still 4 percentage pointsbelow pre-crisis levels
United States
Source: Círculo de Empresarios based on Fed, 201617
Federal Reserve raises interest rates for the second time in a decade
[0.25-0.5]
[0.5-0.75]
16 Dec 2015- 15 Dec 2016
Federal Funds rates, US%
US Federal Reserve expect 3 hikes in 2017
15 Dec 2016- actual
1,4
2,1
2,9 3
0
0,5
1
1,5
2
2,5
3
3,5
2017 2018 2019 Long term
Median Fed funds rate projections (%)
1,30
1,50
1,70
1,90
2,10
2,30
Inflation expectation rate%
1,0000
1,0400
1,0800
1,1200
1,1600
EUR/USD
United States
2017 risks...
Source: Círculo de Empresarios based on JP Morgan, St Louis Fed, 201618
Excessive $ appreciation due to higher interestrates with impacts on emerging and exporters
Higher inflation rates
Expansionary fiscal policy in an
indebtednessenvironment
Lowproductivity
Protectionism
Politicaluncertainty
China: Stabilizing economic growth
Forecast Positive data
Manufacturing PMI
Industrial production
Fixed investment
Retail sales
51.9
6
Source: Círculo de Empresarios based on World Bank and Bloomberg, 2017
%*
%*
%*
points
19
* Annual change, last data available
6.2
10.8
8.3
Macroeconomic policy instruments support China’s growth
Services sector contributed 51.6% to 2016 growth although a more gradual China’seconomic transition investmentconsumption and industryservices
8,4
14,2
10,61
6,7
6,5
0
2
4
6
8
10
12
14
16
China's real GDP growth
%
0
5
10
15
20
25
30
35
40
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Corporate debt and nominal GDP growth(annual change)
Corporate debt growth Nominal GDP growth
China: Financial imbalances
Source: Círculo de Empresarios based on Bloomberg, 201720
China’s credit growth has outpaced
nominal GDP growth for the last years
Forecast
Corporate debt levels near 18
trillion $ (165% of GDP)
China: External sector contraction
remains
Source: Círculo de Empresarios based on Investing and Bloomberg, 201721
Worst data sincethe financial crisis
+7%
-10%-320 billion $
6,1
-1,8
-7,7
0,5
-13,2
-5,5
-15
-10
-5
0
5
10
2014 2015 2016
China's external sectorAnnual change($ terms)
Exports Imports
50% reserves drop due to dollar aprecciation(since August 2015)
6,3
6,5
6,7
6,9
7,1
CNY/USD, 2016
2,50
2,90
3,30
3,70
4,10
2014 2015 2016
China's foreign exchange reservesTrillion $
European Union: Gradual deceleration
*In aggregate terms, represents 40% of EU-28 GDPSource: Círculo de Empresarios based on IMF, 2017 22
EU-28 real GDP forecasts
2016
2017
1.8%
1.6 %
2.3 0.7
1.3
1.5
1.5
2017 real GDP forecasts
Top 5 EU-28 countries(%)
Risks associated with political events
“Hard Brexit”
General elections in Netherlands
(March), France (April) and
Germany (September)*
Banking sector sustainability
Lower growth drivers (Limits of monetary policy and higher oil
prices)
Global trade contraction
European Union: Brexit
Economic activity was resilient
Source: Círculo de Empresarios based on Eurostat, European Commission, 201723
Brexit
Economic growth stability and higher confidence revealed EU economic strength although political
uncertainty due to Brexit negotiations, and the 2017 European political calendar
-8,0
-6,0
-4,0
-2,0
0,0
2,0
4,0
EU and UK real GDP growthAnnual change, %
UK EU-28
102
104
106
108
110
Economic sentiment indicator, 2016
uk EU
Source: Círculo de Empresarios based on Eurostat, 2016
Eurozone: Economic growth and labor market
The unemployment rate stood at the lowest rate
since the financial crisis
24
Main growth drivers
DOMESTIC DEMAND
Investment rates remained weak
8 8,66,2
8,9 7,3 7,5 6,6 6,9 7 5 63,7 4,5 4
8,2
23,118,9
11,910,5
9,8 9,58,8 8,3 7,6
7,3 6,86,5 5,8 5,6
4,1
Unemployment rates 2007-2016% labor force
2016 2007
EurozoneHigher inflation pressures
HICP: Harmonised Index of Consumer Prices
Source: Círculo de Empresarios based on Eurostat, ECB, 2017
Eurozone HICP inflation
2016: 0.3% 2017: 1.6%
25
(forecast)
Inflation bullish signals due to higher
enery prices
-1,0
-0,5
0,0
0,5
1,0
1,5
2,0
2,5
Jan
-14
Feb
-14
Ma
r-14
Ap
r-14
Ma
y-14
Jun
-14
Jul-14
Au
g-1
4Se
p-1
4O
ct-
14
No
v-1
4D
ec
-14
Jan
-15
Feb
-15
Ma
r-15
Ap
r-15
Ma
y-15
Jun
-15
Jul-15
Au
g-1
5Se
p-1
5O
ct-
15
No
v-1
5D
ec
-15
Jan
-16
Feb
-16
Ma
r-16
Ap
r-16
Ma
y-16
Jun
-16
Jul-16
Au
g-1
6Se
p-1
6O
ct-
16
No
v-1
6D
ec
-16
Eurozone HICP inflation 2014-16Annual change, %
General Core
Inflation rates are likely to increase to
1% in the first half of the year, and accelerate gradually at the end of the
year depending on market conditions
Inflation pressures will rise labor costs in
the Eurozone
Eurozone: Monetary policyThe ECB extended the Quantitative Easing until the end of 2017, but reduced its monthly purchases
Source: Círculo de based on ECB, 201726
60 80 60
March 2015-16 March 2016- April 2017
April-Dec2017
Public debt purchasesBillion €
ECB holds interest rates unchanged at 0% And a 3.6 trillion € balance sheet
0%
1%
2%
3%
4%
5%
ECB interest rate
1
1,5
2
2,5
3
3,5
ECB balance sheetTrillion €
United Kingdom
Source: Círculo de Empresarios based on ONS, Markit, BOE, 2017 27
Expansion
Contraction
Brexit
Limited short-term impact
56.1
48.2
The pound has fallen 17% since the UK’s
referendum
Jun Sep Dec
2016 InflationAnnual change, %
2016 real GDPAnnual change, %
0.5
1.6
1
Q2 Q3
2.1
2.3
2
Q1
-
BrexitBrexit
1,49
1,23
1,1
1,15
1,2
1,25
1,3
1,35
1,4
1,45
1,5
1,55
GBP/USD
44
46
48
50
52
54
56
58
Manufacturing PMI
2.2
Q4
Italy
Source: Círculo de Empresarios based on EBA and Banca d’Italia 201728
Banking and political uncertainty
There are 360 billion € in non-perfoming
loans (22% of GDP), and represents 1/3 of
the Eurozone`s
In 2016, italian banking stocks fell by
as much as 60%
EU average:
5.7%
* Unicredit, Intesa San Paolo, Banco Popolare, Banca Pop Milano, Monte dei Paschi, UBI
5,3
17,7
0
5
10
15
20
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Non-performing loans rate%
-1,5
-1,0
-0,5
0,0
0,5
1,0
1,5
2,0
2,5
3,0
84,0
86,0
88,0
90,0
92,0
94,0
96,0
98,0
100,0
Q1
201
2
Q2
201
2
Q3
201
2
Q4
201
2
Q1
201
3
Q2
201
3
Q3
201
3
Q4
201
3
Q1
201
4
Q2
201
4
Q3
201
4
Q4
201
4
Q1
201
5
Q2
201
5
Q3
201
5
Q4
201
5
Q1
201
6
Q2
201
6
Q3
201
6
Q4
201
6
Q1
201
7
Q2
201
7
Q3
201
7
Q4
201
7
Global consumption and production of crude
oil and other liquids(mbd)
Stock change (righ axis)
World production (left axis)
World consumption (left axis)
Commodities
Source: Círculo de Empresarios based on EIA, 2017
Oil prices rise after OPEC output deal
29
-75%
+50%
*Arabia Saudi represents 40% of the oil cut
Forecast
20
40
60
80
100
120
Jan-14 Jun-14 Nov-14 Apr-15 Sep-15 Feb-16 Jul-16 Dec-16
WTI price evolution
OPEC reaches an agreement to cut from global oil production 1,2 mbd between January and August 2017*
Commodities (II)
Source: Círculo de Empresarios based on Goldman Sachs, S&P Dow Jones Indices, IMF, 2017
Gradual recovery in commodity prices
30
Note: The index includes both fuel and non-energy pricesGoldman Sachs Commodity Index (GSCI): Index which measures a fully collateralized commodity futures investment that is rolled forward from the fifth to the ninth business day of each month.
+30%
80
85
90
95
100
105
110
115
120
Commodity prices Index2005=100
250
270
290
310
330
350
370
390
410
Goldman Sachs Commodity index (GSCI)
-22,6
-20,9
20
-15
-7
-3,2
2,9
15
18
Argentine peso
Turkey Lira
Mexican peso
British pound
Chinese yuan
Euro
Japanese yen
Russian ruble
Brazilian real
Foreign Exchange Market
Source: Círculo de Empresarios based on Bloomberg, 2017
Currency changes against the US dollar
%
31
Political uncertainty and Central Banks decisions affected the course of the
Foreign Exchange Market
(Brexit- end 2016: -16%)
(Trump- end 2016: -5%)
-
Financial markets
Source: Círculo de Empresarios based on Bloomberg, Investing, 2017 32
Stock market performance, 2016%
After the intense political calendar, stock markets stabilized
IBEX-35 performance
2014: 2015: 2016:-7% -2%3.7%
CBOE: (Chicago Board Options Exchange)
38,9
14,410
6,9 5,3 4,90,7 0,4
-2
-10,2 -12,3-20
-10
0
10
20
30
40
50
10
14
18
22
26
30
CBOE volatility index 2016
Brexit
Trump
Boosted growth in 2016…
34
Lower macroeconomic imbalances
Employment creation
Advances in the private sector deleveraging
Monetary stimulus and improved financial conditions
Expansionary fiscal policy orientation
Recovery external competitiveness
Effects of the drop in the crude oil price
Forecasts: The expansion is extended… …although at a more moderate pace
35
3.3% 2.5% 2.4%
3.2% 2.5% 2.1%
3.2% 2.3% 2.1%
3.2% 2.3% 2.1%
2017 2018
Government
Bank of
Spain
IMF
European
Commission
2016
Source: Círculo de Empresarios, 2017
Forecasts 2017:Composition of growth
Projections interannual growth of GDP in 2017 = 2.5%
•Private consumption = 2.1%*
•Public consumption= 0.8%*
• Gross fixed capital
formation = 3.8%*
* % annual change
Domestic demand
2.2 ppGrowth contribution
Source: Círculo de Empresarios based on Bank of Spain. December 2016 36
0.3 pp
External demand
Growth contribution
• Exports* = 4.2%
• Imports* = 5.4%
* Goods and servicies
% annual change
Current Growth
Consumption, either private or public,
leads recovery in Spain
Spain, despite nacional and
international uncertainties, keeps the
positive growth differential with the
OECD and the Eurozone
Third consecutive quarter of positive
contribution of external demand
37Source: Círculo de Empresarios based on Bank of Spain, INE and OECD, 2017
-8
-6
-4
-2
0
2
4
GDP (annual change) and contribution of
domestic and external demand (pp)
Domestic demand
External demand
GDP Spain
GDP Eurozone
GDP OECD
Domestic demand: Households
38
The GDP growth is based on national
demand, with a higher dynamism of private
expenditure
The confidence of the consumers improves
Source: Círculo de Empresarios based on Bank of Spain, 2017
-4
-2
0
2
4
6
8
10
Spending decisions% quarterly change
Residential investment
Private consumption
-2,5
-2
-1,5
-1
-0,5
0
0,5
1
1,5
2
2,5
Jan
13
Ma
r 13
Ma
y 1
3
Jul 1
3
Se
p 1
3
No
v 1
3
Jan
14
Ma
r 14
Ma
y 1
4
Jul 1
4
Se
p 1
4
No
v 1
4
Jan
15
Ma
r 15
Ma
y 1
5
Jul 1
5
Se
p 1
5
No
v 1
5
Jan
16
Ma
r 16
Ma
y 1
6
Jul 1
6
Se
p 1
6
No
v 1
6
Confidence indicatorsNormalized indicators (difference between the indicator
and its average, divided by its standard deviation)
Retail trade Consumers
Sectoral distribution of growth
39
The dynamism in the market service is hold and an upturn in the energy and
industry sector is forseen
Source: Círculo de Empresarios based on Bank of Spain, 2017
* GVA: Gross Value Added
-1
-0,8
-0,6
-0,4
-0,2
0
0,2
0,4
0,6
0,8
1
1,2
Jan
13
Ap
r 13
Jul 1
3
Oc
t 1
3
Jan
14
Ap
r 14
Jul 1
4
Oc
t 1
4
Jan
15
Ap
r 15
Jul 1
5
Oc
t 1
5
Jan
16
Ap
r 16
Jul 1
6
Oc
t 1
6
GVA* by sectorsContribution, unless other indicated
Services
Construction
Industry and energy
Agriculture
GVA (% quarterly change)
Labour market (I) Unemployment rate in Spain 4Q 2016 = 18.63% of labour force (INE)
and 19.2% (Eurostat) vs. Eurozone average = 9.8% (Eurostat)
40Source: Círculo de Empresarios based on Eurostat, 2017
8,39,8
19,2
0
5
10
15
20
25
Unemployment EU 28% labour force
Labour market (II)
SEPE data - December 2016:
▼ unemployed = 86.849 vs. Nov.
▲ affiliates = 68.531 vs. Nov.
▲ new contracts = 1.699.018
41
Between 2013 and 2016
unemployment has reduced
by 1 million of persons and
affiliates have increased by
almost 1.5 millions.
Source: Círculo de Empresarios based on Ministry of Employment and Social Security, January 2017
16.393.866
17.849.055
4.763.680
3.702.974
0
1.000.000
2.000.000
3.000.000
4.000.000
5.000.000
6.000.000
16.000.000
16.500.000
17.000.000
17.500.000
18.000.000
18.500.000
19.000.000
19.500.000
20.000.0002007
2008
2009
2010
2011
2012
2013
2014
2015
Jan
-16
Feb
-16
Ma
r-16
Ap
r-16
Ma
y-16
Jun
-16
Jul-16
Au
g-1
6Se
p-1
6O
ct-
16
No
v-1
6D
ec
-16
Affilia
tes
Evolution of the affiliation to Social Security and registered unemployed
Persons
Affiliates
Unemployed
Un
em
plo
ye
d
Social Security Reserve Fund
Its balance represents
1.4% of GDP
42
At the current rate of
withdrawals, the
Fund will disappear
at the end of 2017
Source: Círculo de Empresarios Based on Ministry of Employment and Social Security, 2017
9.837 11.507
2.799 4.3532.440
-3.807
-9.264
-15.300-13.250
-9.700 -9.500
-936
35.879
45.716
57.22360.022
64.37566.815
63.008
53.744
41.634
32.481
24.207
15.900 15.020
-20.000
-10.000
0
10.000
20.000
30.000
40.000
50.000
60.000
70.000
2000-06 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
(Jul)
2016
(Dec I)
2016
(Dec II)
Social Security Reserve Fund
Million €Contributions (+) / withdrawal (-)
Balance (adquisition P)
Prices: risk of losing competitiveness
December 2016:
Annual CPI increases to 1.6%, mainly
because of the increase in energy prices
Prices are rising above the Eurozone
average
43Source: Círculo de Empresarios based on INE, Eurostat, Bank of Spain and OMIE, 2017
1,6
2,6
Forecast
FUNCAS
1,0
1,1
-1,5
-1
-0,5
0
0,5
1
1,5
2
2,5
3
General and core inflation% annual change
CPI Spain
Core inflation Spain*
CPI Eurozone
* Without energy and non-processed food
-2
-1
0
1
2
3
CPI by sectors Services
Industrial non-energy products
Processed food
Non processed food
Energy
General
48,37
87,9
45
50
55
60
65
70
75
80
85
90
Electricity priceArithmetic average
€ mgw/h
Financial conditions
Credit increases mainly in consumption and agriculture
Default rate falls down while it remains high in the
construction and developer sectors
44
Financial conditions improve mainly because of the
stimulus of the monetary policy
Source: Círculo de Empresarios based on Bank of Spain, 2017
Note: Credit to households and business includes credit granted, measured on annual change terms
Credit and default rate in Spain 3Q 2016
Bn. € and %
Balance
3Q 2016
Annual
change
Default
rate
Households (housing) 540 -3,1 4,7
Households (consumption) 115 4,7 8,3
Productive activities 604 -7,7 13,5
Construction 41 -9,3 29,1
Developer 123 -9,3 25,6
Serv ices 314 -9,2 8,5
Industry 107 -2,9 9,3
Agriculture 19 5,6 9,2
Total* 1.259 -4,8 9,2
-10
-5
0
5
Ma
r 13
Ma
y 1
3
Jul 1
3
Se
p 1
3
No
v 1
3
Jan
14
Ma
r 14
Ma
y 1
4
Jul 1
4
Se
p 1
4
No
v 1
4
Jan
15
Ma
r 15
Ma
y 1
5
Jul 1
5
Se
p 1
5
No
v 1
5
Jan
16
Ma
r 16
Ma
y 1
6
Jul 1
6
Se
p 1
6
No
v 1
6
Credit to households% annual change
Total
House purchase
Consumption and other
-15
-10
-5
0
5
10
Ma
r 13
Ma
y 1
3
Jul 1
3
Se
p 1
3
No
v 1
3
Jan
14
Ma
r 14
Ma
y 1
4
Jul 1
4
Se
p 1
4
No
v 1
4
Jan
15
Ma
r 15
Ma
y 1
5
Jul 1
5
Se
p 1
5
No
v 1
5
Jan
16
Ma
r 16
Ma
y 1
6
Jul 1
6
Se
p 1
6
No
v 1
6
Credit to business% annual change
Total
Resident business
Others
Public debt
According to the Government it will start
to fall in 2017 (99% of GDP) and it will
reach 96% of GDP in 2019.
The European Commision estimates that
it will amount to 110% of GDP in 2027
45
Public debt was 100.3% of GDP in the 3Q 2017
Source: Círculo de Empresarios based on Bank of Spain, European Commission and Ministry of Economy, 2017
58,0
54,251,3
47,645,3
42,338,9
35,5
39,4
52,7
60,1
69,5
85,7
95,4
100,499,8
101,1
101,0100,3
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
1Q
201
6
2Q
201
6
3Q
201
6
Public debt
% of GDP
99,5 99,9 100
101,4
109,6
99,1 9997,9
96
95
97
99
101
103
105
107
109
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
Public debt forecats % GDP
European
Commission
Government
January – November 2016 (annual change) – Trade balanceGeographical distribution (%)
Ex
po
rts
Imp
ort
s
Source: Círculo de Empresarios based on Ministry of Economy and Competitiveness, January 2017
External sectors
46
Exports ▲ 1.6% 233.798 M€
Imports ▼ 0.9% 250.106 M€
BALANCE ▼ Deficit 27.1% -16.308 M€▼ 40%
energy deficit
Exp
ort
s
Capital goods
Automotive industry
Food. beverages and tobacco
Imp
ort
s
Capital goods
Chemical products
Automotive industry
Top 3 sectors (% of total)
20.2
18
16.7
21.7
15.7
13.8
-94.159,9-24.173,9 -16.308,0
-100.000
-50.000
0
50.000
100.000
150.000
200.000
250.000
300.000
Million € Exports Imports Balance
Europe
72,2
EU
66,5
America
10,4
Asia
9,3
Africa
6,3
Other1,8
Exportaciones
Europe
62,7
EU
56,9
Asia
19,5
China
8,8
America
10,2
Africa
7,3
Other0,3
Importaciones
Tourism 2016
47
12 3
Source: Ministry of Energy, Tourism and Digital Agenda, 2017
941 977 971 986 1,0230
2
4
6
8
10
12
0
10.000
20.000
30.000
40.000
50.000
60.000
70.000
80.000
2011 2012 2013 2014 2015 2016
Tourism expenditure Million € (left)
% annual change (right)
Expenditure per tourist (€)
TOP 10 tourism source countries (Jan. - Nov. 2016)
Tourists % total % annual change
UK 16.961.140 22,5 12,3
France 10.767.308 14,3 7,1
Germany 10.734.120 14,3 6,1
Italy 3.733.716 5,0 5,6
Netherlands 3.232.656 4,3 9,4
Belgium 2.207.605 2,9 2,7
USA 1.884.299 2,5 6,2
Portugal 1.872.672 2,5 15,8
Ireland 1.742.615 2,3 22,7
Russia 962.644 1,3 1,8
2,3
5,67
5,1
9,9
57.46460.675
64.93968.215
75.300
0
10.000
20.000
30.000
40.000
50.000
60.000
70.000
80.000
0
2
4
6
8
10
12
2012 2013 2014 2015 2016
Arrival of touritsThousands and annual change (%) ▲ annual Tourists
Tourists arrivals by regions 2016% of total
Galicia1.4%
Asturias
0.4%
Cantabria0.5%
Basque C.1.9%
La Rioja0.2%
Navarre0.4%
Aragon0.9%
Catalonia23.8%
Valencian C.10.4%
Murcia1.3%
Andalusia14.2%
Balearic I.18%
Canary I.16.8%
Extremadura0.3%
Castile and Leon1.6%
Madrid7.4%
Castile-La Mancha0.3%
Source: Círculo de Empresarios based on Ministry of Energy, Tourism and Digital Agenda, 2017
Total: 75.3 millions
48
1st
2st
3st
4st
5st
Interest rates and risk premiumsThe risk premium remained stable around 110 b.p., in the European average
49Source: Círculo de Empresarios based on Bank of Spain and national Central Banks, 2017
0
20
40
60
80
100
120
140
160
180
-0,5
0
0,5
1
1,5
2
2,5
3
Ten years bond yield. Spain and Germany (%)Risk premium (bp)
Spain
Germany
Risk Premium
Risk
premiumInterest rate
-49
5 12 16 20 28 34 49 63102 107 125
162
340
669
-100
0
100
200
300
400
500
600
700
Risk premiumsBasic points
Spain´s position in international rankings
Switzerland
Singapore
UK
SPAIN
50
Global Innovation Index 2016(128 countries)
Source: Johnson Cornell Univ., INSEAD y WIPO, 2016
▼1(2015)
Denmark
New Zealand
Finland
SPAIN
1
2
3
41
Corruption Perception Index 2016(176 countries)
Source: Transparency International, 2017
▼5(2015)
1
2
3
35
Global Talent Competitiveness Index 2017(118 countries)
Source: Insead, 2017
▲1(2015-2016)
Finland
Norway
Switzerland
SPAIN
1
2
3
45
Human Capital Index 2016 (130 countries)
Source: WEF, 2016
▼4(2015)
USA
Switzerland
Canada
SPAIN
1
2
3
33
Global Entrepreneurship Index 2017 (137 countries)
Source: The Global Entrepreneurship and Development Institute, 2017
▼1(2016)
Denmark
Norway
Finland
SPAIN
1
2
3
24
Rule of Law Index 2016(113 countries)
Source: The Justice Project, 2017
=(2015)
Switzerland
Sweden
UK
SPAIN
1
2
3
28
www.circulodeempresarios.org