Spain: Recovery position

"Spain's return to growth is good news, but there is little evidence that it is the result of austerity and reforms," says Simon Tilford, deputy director at the Centre for European Reform.
He says Spain's gross domestic product, €1.04tn last year, is still lower than it was before the crisis, and that its broader economic outlook is "cloudier" than the consensus would suggest. Even on present growth assumptions Spanish GDP will return to its pre-crisis level only in 2017. Domestic demand will take at least another five years to fully recover," says Mr Tilford.

...Mr Tilford makes a similar point: "Spain requires considerably stronger productivity growth if Spanish living standards are to converge with wealthier EU countries." He argues that Spain spends too little on research and development, invests too little in education and depends too much on low-quality jobs in sectors such as tourism. For a sustained recovery, it will have to change course in all three areas, and it will have to do so while keeping a firm lid on government spending.