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Economy

Economy

Spain Economic Outlook

BBVA Research maintains Spain’s growth forecast at 2.7% for the 2016-2017 two year period, according to its recent report Spain Economic Outlook. Chief Economist for the BBVA Group and Director of BBVA Research, Jorge Sicilia, and Chief Economist of Developed Economies at BBVA Research Rafael Doménech presented the report today. BBVA Research indicates that “in 2Q16, the economy could see four consecutive quarters of GDP growth around 0.8% (3.2% annualized), which would mean an upward bias for 2016 forecasts.” The growth of the Spanish economy is expected to create approximately one million jobs in two years. However, some strongholds are weakening. This and other foreseen risks mean a downward bias for growth in 2017.

Like every May 9th, today marks the annual celebration of Europe Day in Brussels. This date commemorates the anniversary of the historic Schuman Declaration. Robert Schuman, then French Foreign Minister, presented his idea for a new form of political cooperation that would make another war among European nations unthinkable. That’s why this day is dedicated to peace and unity in Europe.

Rafael Domenech BBVA.

Economist, professor, advisory and director of several organizations related to economic research… Rafael Domenech’s professional life has always been connected to economics, and in parallel, to teaching. Chief Economist of Developed Economies at BBVA Research since 2009, Domenech is also a Professor of Economic Analysis at the University of Valencia. This fact permeates all of his explanations, which those who attend his presentations describe as “very educational”.

Born in Sao Paulo while his parents spent a five year period there, he is Brazilian by birth but Valencian by adoption and believes that there is a great need for education in economics. He is the author of numerous articles in prestigious international and national magazine on human capital, growth, economic cycles and monetary and fiscal policies, and recently published a book, 'En busca de la prosperidad (The Search for Prosperity)' that includes measures the Spanish economy should take to increase employment, equity and well-being.

He holds a Master of Science degree from the London School of Economics and a PhD in Economics. He has also worked as a collaborating researcher for the OECD, the European Commission, the Ministry of Economy and Finance and the Rafael del Pino Foundation, among others.  The author of numerous publications, together with other BBVA Research team members he has prepared an Economic Observatory with proposals to reform the labor market in Spain, which was published today (in Spanish).

Sovereign Wealth Funds are state-owned investment vehicles that control a portfolio consisting of national and international financial assets. The capital that these institutions manage is essential for the economies as it allows them to mitigate economic shocks; safeguard the wealth of future generations; make key investments for the country’s development; pay pensions; or maximize the profitability of a percentage of the country’s international reserves – generally the surplus over the level deemed optimal - which are usually managed following a capital preservation approach.

The buzz surrounding the TTIP – the free-trade treaty that the US and the European Union started negotiating back in 2013 - keeps growing louder. While the name may already ring a bell for a majority of people, many may still be wondering what’s behind the acronym and how will it affect, for good or for bad, the Spanish economy and, by extension, our everyday lives.

Op-ed by Federico Steinberg, Senior Analyst for Economy and International Trade at the Elcano Royal Institute 

For the last 200 years the world economy has been dominated by the North Atlantic countries. First, by Europe alone, and then by Europe and the United States (with a marked North American leadership after the Second World War). However, the decline that began 20 years ago in the relative weight of the transatlantic axis in the world economy is expected to accelerate in coming decades. The beneficiaries will be the new emerging powers –particularly in Asia, but also in Latin America and Africa.

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The European Deposit Insurance Scheme is one of the essential steps towards the completion of the banking union. At the same time, banking authorities are reviewing the treatment granted to banks’ sovereign risk exposure. However, both lines of work should be independent. BBVA executive board director José Manuel González-Páramo took the opportunity offered by his participation in the Eurofi financial forum – which is taking place this week in Amsterdam – to defend this idea.