Spain 2014

The OECD Economic Survey of Spain for 2014 examines recent economic developments, prospects and policies. This edition includes special chapters covering raising potential growth and boosting the business sector. The Spanish economy has returned to moderate growth following a protracted recession and, crucially, sovereign spreads have fallen sharply. This major turnaround reflects decisive reforms to strengthen the banking sector (including a financial sector programme), the European Central Bank's actions, the improvement of public financesustainability, with a now somewhat slower pace of fiscal consolidation, and reforms to enhance product and labour markets. Nevertheless, the key challenge now is to build on these achievements to enhance growth and reduce unemployment significantly through sustained gains in productivity and competitiveness and to reduce external debt. This will require orderly reduction of public and private sector debt, improvements in labour market institutions and policies to reduce the very high unemployment rate (which is itself a key driver of inequality), and reforms to the business sector environment to promote the entry and growth of firms.