The Government ignores the IMF and FIA reduction of public debt to increasing tax revenues

The Government has no plan to reduce the huge public debt accumulates Spain despite the fact that the IMF has repeatedly requested it. In fact, the Internatio

The Government ignores the IMF and FIA reduction of public debt to increasing tax revenues

The Government has no plan to reduce the huge public debt accumulates Spain despite the fact that the IMF has repeatedly requested it. In fact, the International Monetary Fund, the Bank of Spain and also the Independent Fiscal Responsibility Authority (AIRF). But the last body that has done it is that He directs Kristalina Georgieva, which in the report on the Spanish economy that she published yesterday claims that the debt goes "reducing gradually" and "a short-term credible fiscal consolidation plan". The reason: that the country has a greater fiscal space in case there is a new crisis, that is, which does not happen precisely what happened before the recession derived from Coronavirus. And the executive's response: that there is already a path provided in the budget plan sent to Brussels and that, in addition, the collection is pulling hard and that will allow to accelerate the reduction.

"Thanks to the increase in collection by 2021, our forecast is to be even below the deficit and debt goals," the First Vice President and Minister of Economic Affairs, Nadia Calviño, explained by the IMF's request. The argument, in addition, is in line with what has already expressed the Minister of Finance, María Jesús Montero, when she has pointed out that the additional increase in income that will report fiscal reform will advance fiscal sustainability. Or in other words: that the Executive Fía any possible additional reduction in the debt to increasing taxes. And in no case contemplates concrete measures such as asking for the Bank of Spain, the Airof or the IMF.

That means, according to the forecasts included in the aforementioned document on the Spanish economy, which public liabilities will be reduced from 120% of the gross domestic product (GDP) from 2021 to 117% in this year. Next year will be recorded a new reduction, up to 115.8%, and will already stay at that level throughout the analyzed period, which reaches up to 2027. The Fund, therefore, does not trust at all that it really leaves To produce a substantial reduction, and therefore, it emits the aforementioned petition as the Government, however, ignores.

It is not the only suggestion that the revision of the Spanish economy contains. Social security is another point that worries those responsible for the IMF, both that they ask the Executive to "ensure the sustainability of the pension system". It does so after the executive has approved the first part of the reform and when the Ministry of Security is working on the second.

In terms of growth, the organism considers that Spain will recover the level of GDP prior to the crisis at the end of this year. This highlights the delay with respect to the average of the eurozone, which reached this milestone already at the end of 2021. The specific advancement of advancement in 2022 is 5.8%, a figure that will face a clear deceleration: EN 2023 growth Expected is 3.8% and 2.3% in 2024.

On inflation, the text points out that the CPI reached the record of the last 30 years driven by the base effect - from the price drops of 2020- and by the continuous increase in gas prices. And for 2022 it foresees that it follow up. "Inflation is likely to follow elevated at the beginning of 2022 due to high energy prices and the disruptions of the supply chain, but should be moderated in the second half of the year as these factors dissipate," he says.

Specifically, they expect the average data to end the year at 3.5%, above 3.1% registered in 2021. In the rest of the period, the price increases will be moderated and inflation will stabilize around 1 , 7%.

Finally, and as far as the Labor Reform is concerned, the IMF celebrates its approval, and gives "welcoming" to a measure "aimed at correcting the deficiencies that both have been existing and balanced by giving more protection to workers and preserve flexibility for companies ».

Date Of Update: 16 February 2022, 20:53

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