Spain’s Deficit Reduction: A Success Story in 2023

Spain meets deficit goal and finishes 2023 with 3.64% GDP.

In 2023, Spain recorded a public deficit of 3.65% of GDP, excluding financial aid, slightly lower than the previously reported provisional figure of 3.66%. The Ministry of Finance has provided Eurostat with the official closing data, which meets and even surpasses the 3.9% forecast committed to the European Commission. This marks the fourth consecutive year that Spain has fulfilled its obligations to Brussels.

Spain’s deficit reduction was attributed to economic growth, with Spain growing 2.5% in 2023, five times more than the euro zone average. Employment also played a significant role, with a record number of Social Security affiliates reaching 21 million employed individuals. Despite this progress, Spain reinforced its Welfare State and social protections to combat the effects of the war in Ukraine. Since the start of the pandemic in 2020, Spain has reduced its deficit by over 60 billion euros while expanding public services.

The Social Security system closed 2023 with a deficit of 8,627 million euros, equivalent to 0.59% of GDP, despite record contributions and increased employment. The closing data for 2023 show a negative balance of 8,211 million euros, equivalent to 0.56% of GDP, for the Social Security Funds, which include the Salary Guarantee Fund (Fogasa) and the Spanish Public Employment Service (SEPE). Social Security received 43,908 million euros in transfers last year, showing a 2.8% increase. Overall, the Spanish financial landscape in 2023 displayed a mix of deficit reduction

Leave a Reply