Calviño gets off the official forecast and considers a growth of 7% for 2021

The Vice President for Economic Affairs, Nadia Calvin, appeared back in the month of October at the press conference after the approval of the General State Budget project for 2021 with a macro picture that was not the one that really supported the budget project. While Calviño’s presentation reflected a central growth scenario of 7.2% for 2021, the Budgets were based on the contrary on a much more dynamic GDP growth of 9.8%, which was later justified by the Government due to the phenomenal momentum that the execution of the nearly 27,000 million euros in European funds that the Government intends to apply this year would have on the economy. The Economy justified the matter as a simple error in the information transferred to public opinion, but government sources say that the vice president did not finish feeling comfortable with a official forecast that deviated significantly from the consensus of analysts and that conveyed a perhaps too optimistic vision of what could happen in 2021, with the country, Europe and the world still mired in a pandemic.

The rebound in Covid-19 cases, which has already started to speak of the third wave, and the somewhat less vigorous behavior of the Spanish economy in the last quarter of last year have made the year just started the official growth forecast for this year is beginning to be questioned. The vice president was asked about this in an interview this Monday on Cadena Ser and at the time of answering Nadia Calviño has not wasted a second trying to defend the official forecast of 9.8% which supports the 2021 Budgets and has ensured that the Government continues to believe in its central scenario “of growth of around 7%”.

The point is that this is not the central growth scenario that the Government has put on the table. The central government scenario, which the Independent Authority for Fiscal Responsibility has estimated as feasible but highly unlikely, is that the economy will grow by 9.8% this year, thanks to the pull of European funds. The scenario to which the vice president refers is the one that Calviño explained the day the Council of Ministers approved the budget project and which refers to what the inertial behavior of the economy would be in the event that European funds were not executed. ..

The ‘no rise’ of the Minimum Wage

The vice president understands in any case that achieving this growth of around 7% is feasible and that the entire effort of the Government is focused on trying to make the recovery of the economy as fast and vigorous as possible. In this will he has also framed the final decision of the Executive, after many tug of war and an undisguised public pulse with the Minister of Labor and the Podemos Government area, not to raise the Minimum Interprofessional Salary in 2021 as long as the situation of economic uncertainty.

Calviño has defended that this decision is consistent with a line of economic policy in which it is trying to protect as many jobs as possible and to support companies, reducing their cost structures precisely so that they are not forced to lay off or close down and leave their employees on the street. The vice president has hinted that raising the SMI in the current context, “after a double-digit drop in GDP”, would affect the employment of young people and women. Regarding the argument raised by Podemos that the increase in the SMI would only mean nine euros per month and that it does not seem that this cannot be assumed by the companies, the vice president has assured that such comparisons are not appropriate and that they only seek to generate “false conflicts “.