The AIReF does not contemplate a recession in Spain, but admits concern for the winter due to gas

MADRID, 6 Jul. (EUROPA PRESS) -

The president of the Independent Authority for Fiscal Responsibility (AIReF), Cristina Herrero, rules out "right now" the possibility of a recession in Spain in the face of a scenario marked by the war in Ukraine and the escalation of prices, although she has acknowledged concern about what will happen with the gas supply for the winter.

"Regarding the recession, in AIReF's central scenario we do not contemplate that possibility right now," assured the president of the independent organization during her participation in the informative breakfast Forum Europe, of the New Economy Forum.

Thus, Herrero has maintained that from the AIReF they foresee that Spain will register "significant" growth in 2022 based on the positive evolution of the services sector and, especially, tourism. In addition, and despite the negative criticism for its "slow" execution and deployment, the agency also expects a positive impact from the Recovery, Transformation and Resilience Plan.

However, the uncertainty at the international level makes AIReF be alert and, facing winter, Herrero has expressed his concern about what will happen to the gas supply, after the cut by Russia, since there could be a situation of "energy emergency", which would particularly affect other EU countries that are "main partners" for Spain, so it would also end up affecting at a national level.

In fact, Herrero recalled that the forecasts of the European Central Bank (ECB) in its central scenario do not contemplate a recession, but in a more adverse scenario in which it is warned that, in the event of a total embargo on the Russian gas supply to Europe, GDP would fall by 1.7% in 2023.

"Not at this time, not for our country, but there is concern about what may happen in the winter regarding the evolution of the euro zone," acknowledged the president of the independent body.

REVISION OF FORECASTS

Of course, despite this "important" growth estimated by the Independent Authority, Herrero has warned that some risks that he has been warning about for a few months --bottlenecks or energy-- are already materializing, for which he will reassess in the next Report on July 19 its forecasts, in line with most analysts.

This will mean a reduction in the outlook for the Gross Domestic Product (GDP) below what was previously forecast and also a revision for inflation.

As for the fiscal path, AIReF will also review its outlook for the deficit this year in July -- above the 4.2% estimated by the agency but below the 5% forecast by the Government -- to incorporate the new measures announced to deal with the economic impact of the war in Ukraine.

And it is that, since the Report on the Update of the Stability Program was published in May, new measures have been approved that will mean an increase in the deficit in 2022 of 0.5% of GDP over the previous forecast.