Figures released by the National Statistics Institute (INE) show that the Spanish economy plummeted by 11% in 2020, while the International Monetary Fund (IMF) downgraded Spain´s expected economic performance from a 7.2% growth rate in October to just 5.9% for 2021.
The 2020 contraction in GDP is the biggest since the beginning of the Civil War in 1936 and nearly 3 times worse than the economic crisis of 2009.
Spain also has the worst ranking of all the world´s economies for economic performance in 2020.
The fall is attributed to the seizure of large parts of key sectors of the Spanish economy due to the coronavirus pandemic, most notably tourism which fell by around 70% from 2019.
The tourist sector usually represents around 14% of the economy but in 2020 this fell dramatically to around 4%.
Despite the reduced rate of the economic rebound the IMF forecasts continued growth in 2022 of 4.7% which is slighly higher than their October estimate of 4.5%.
The report highlights the importance of the Spanish governments vaccine programme which will have a direct affect on the rate of growth in the economy.
In addition Spain will benefit massively from the EU´s Recovery Plan, with 70 billion Euros in grants and another 70 billion Euros in soft loans.
The Spanish economy is expected to recover to its pre-pandemic level by the end of 2023, however unemployment rates are expected to remain high.
The latest unemployment figures show 16% of the workforce out of work and that figure is likely to increase substantially when the government´s ERTE fullough scheme ends in May.