Spain Population and Economy 1991

In application of the Constitution which entered into force on December 28, 1978, the Spanish territory was divided into 17 Comunidades autónomas, each with its own legislative and executive bodies, with wide jurisdiction: Basque Country and Catalonia had their respective elections in March 1980, Galicia in October 1981, Andalusia in May 1982, and the rest in May 1983. Various Autonomous Communities, within which the traditional provincial divisions remain, officially adopted bilingualism, equating the local languages ​​(Euskara, Catalan, Galician) to Castilian.

Population. – At the 1991 census the population amounted to 38,748,053 residents (77 residents / km ²); was 37,682,355 as of March 1, 1981. With an annual growth coefficient that fell from 1% or a little more in the 1970s to 0.2% in the period 1987-92, the Spanish population in the last decade has maintained a balance slightly positive, well distributed among the various communities of the country, with the exception of a few isolated cases above the average (Madrid, Murcia). Conversely, there are stationary situations in very few provinces (Ávila, Segovia and Soria in Castile-León; Huesca and Teruel in Aragon) and a slight decline in the province of Santa Cruz de Tenerife alone, in the Canary Islands, which is in the process of rebalancing. According to trackaah, these data, however, hide the persistence of socio-economic imbalances between the South and the rest of the Spain, imbalances that continue to fuel strong internal and international migrations that are now very attenuated compared to the recent past. In the same sense, the constant tendency towards urbanization should be underlined, still clear although it now privileges – as in other developed countries – medium-sized cities more than metropolises. The capital, Madrid, had 2,909,792 residents in 1991.

Economic conditions. – Although the Spain is today to be considered the fifth industrial power of Community Europe, and among the top ten in the world, its economy remains largely characterized by agricultural production, which is provided by 10.1% (1992) of the active population. In 1992, per capita income amounted to over $ 14,000 but in 1993, as a result of the weakness of the peseta on international markets, it returned to $ 13,650. In the period 1985-93, in real terms, income increased, on average, by 3.1% per year.

Still relevant, worldwide, are the production of citrus fruits (4.9 million t in 1992), olives (0.3 million t), olive oil (0.6 million t), wine (37 million hl), of vegetables, fruit and flowers. The latter have guided the reconversion due to the progressive insertion into the Community agricultural market, especially as early fruits, and are constantly increasing thanks also to the considerable expansion of irrigated areas (especially in the Levant regions) and of greenhouses (in the province of Almería, with about 10,000 ha, it has the largest set of greenhouses in Europe). However, some traditional negative characteristics also remain, such as low productivity in cereals (about 30% of the average productivity of the European Union), and in viticulture which, while boasting the largest cultivated area in the world, its production is far below that of Italy and France. To a large extent, however, these are the consequences of environmental constraints (aridity, steepness, etc.) that are difficult to avoid, so much so that the European Union considers about 60% of Spanish agricultural land to be disadvantaged, and to which it is attempted to remedy with interventions of enhancement and recovery, to which huge resources have been dedicated for many years. Structural, however, is the land imbalance, which is still very heavy: farms with less than 2 ha are 41% of the total and share 1.6% of the agricultural area; conversely, 2.6% of farms own more than 100 ha and cover a total of 61.8% of the agricultural area. Finally, again with regard to the primary sector, the

The rapid process of industrialization that has taken place in the last three decades has made Spain’s considerable mineral resources overall insufficient for internal needs. However, the production of coal (13.9 million t in 1991) and lignite (19.6 million), zinc (206,300 t in 1992), copper, natural gas, uranium, gold, have increased in recent years, while production of lead (31,000 t), iron (1.6 million t), cupriferous pyrites (1.6 million t in 1990, partly exported), and almost abandoned that of mercury, have fallen or barely stable. The processing industry, which employs about one fifth of the assets, is mainly oriented towards metalworking, textiles (cotton) and, more recently, basic chemicals. Especially important is the metalworking sector, with the ancient iron and steel activities (traditionally concentrated in the Basque Country, Asturias and the Levant), which continue to give a quantitatively important product but now stabilized for years, and with the mechanical industries, first of all the automotive one (which, with 1,790. 000 cars produced in 1992, about two thirds exported, ranks third in Europe and fifth in world production per country), and shipbuilding. Parallel to the industrial growth, there has naturally been an increase in the energy supply, with an installed power (1991) of over 43.6 million kW and a production of 155.700 million kWh, of which one fifth of water origin and approximately double of nuclear origin (in nine thermonuclear power plants). Finally, it should be noted

Always better inserted in the European Union and almost aligned, in terms of average socio-economic conditions, with other countries, the Spain seems to have to solve above all structural problems of a social order, even if the economic conditions are not completely reassuring, as demonstrated the trade balance (now almost entirely related to intra-community trade) in permanent deficit in recent years, only partially offset by an ever-increasing tourist influx (52.3 million presences in 1992).

Economic and financial policy

At the beginning of the 1980s the Spanish economy was characterized by a modest growth rate (less than 1% in the period 1980-82), by a higher rate of inflation than the average for European countries and by large current account balance-of-payments deficits (about 2.5% of GDP per annum). In 1983 the authorities embarked on an adjustment process based on a substantial tightening of monetary policy. This process was reinforced by an income policy aimed at promoting a significant decrease in real wages and by an 8% devaluation of the peseta in December 1982. However, no significant results were achieved in containing public spending: despite a increase in the tax burden, in 1985 the public deficit,

The monetary tightening ensured an improvement in the external account situation and in inflation. In 1985 the current account balance in fact presented a surplus of the order of 2% of GDP, while the rate of increase in consumer prices, from over 14% in 1982, fell to 7%. Corporate profits have also improved significantly during this period. However, the adjustment process led to a contraction in domestic demand, especially for investments, and an increase in the unemployment rate which rose from 16% in 1982 to 21.5% in 1985. The deterioration of the labor market situation has urged the Spanish authorities to make financial conditions less restrictive; since 1985, in fact, tax relief has been introduced tax and investment tax incentives. In 1986, public spending continued to stimulate economic activity through the rapid growth in consumption and employment, determined in part by the process of regional decentralization. Nonetheless, the introduction of VAT, the increase in taxes on petroleum products and other taxes, together with the recovery of economic activity, have contributed to the significant increase in government revenues and the reduction of the public deficit in relation to GDP (since 7% in 1985 to 6% in 1986). The recovery of credit to the private sector, the increase in real wages, the reduction of some structural rigidities in the labor market, together with the favorable trend of the terms of trade, allowed a significant acceleration of the growth rate in the three-year period 1987-89 (more than 5% on average per year). In this period, the inflation rate fell by nearly four percentage points, to around 6%, while the public deficit as a ratio of GDP fell by three percentage points.

The early 1990s were more difficult for the Spanish economy: the growth rate of GDP gradually decreased, until it was negative in 1993. The inflation rate showed only limited improvements, while both the deficit increased. public (from 2.8% of GDP in 1989 to 7.5% in 1993), and the unemployment rate (from 17.3% to 22.7%). Despite the authorities’ efforts to increase the competitiveness and productivity of businesses, the foreign constraint has once again become stringent. The current account deficit increased from $ 11 billion in 1989 to $ 18 billion in 1992 with an improvement (deficit $ 4.2 billion) in 1993 due to the devaluation of the peseta. In 1994 the country entered an export-led recovery phase, so that the GDP has started to grow again, albeit in the presence of an increase in unemployment. In March 1995, the peseta, hit by the international currency crisis, underwent a further devaluation.