About Spain

Spain has been transformed in the last three decades from a rural, backward, agricultural country into a nation with a diversified economy with strong manufacturing and service sectors. However Spain's bureaucracy remains firmly rooted in the 1950's.

Between 1961 and 1973, the so called years of development the Spanish economy grew at 7% a year and in 1963 the per capita income of the Spanish economy reached $500 a year. This elevated Spain from the ranks of the developing nations (as defined by the UN). After joining the EU in 1986, Spain once again had one of the world's fastest growing economies with its annual growth averaging 4.1% in the period between 1986 and 1991, compared with the EU average of 3%. Likewise, foreign trade grew from $23.8 in 1975 to $52.5 billion in 1980 and to $143 billion in 1990.

Today the economy of Spain is the fifth largest in Europe, accounting for around 9% of EU output. Per capita income, at 78% of the EU average is among the lowest in the EU, although it is well ahead of Ireland, Portugal and Greece. Spain's main trading partners are France, Germany and Italy for exports and Germany, France and Italy for imports.

The Basque country and Catalonia are the Spanish economy's main industrial regions and just five of Spain's provinces ( Barcelona, Biscay, Madrid, Navarre and Oviedo, all situated in the north and east) produce over half the country's industrial output. Catalonia, where some 85% of companies are located in Barcelona, is Spain's economic powerhouse and one of Europe's most important industrial regions.

In the early nineties, Spain experienced one of the worst recessions in the EU, resulting in falling output, reduced investment, an increasing public deficit, numerous bankruptcies (including the spectacular failures of Torras and Banesto), and rising inflation. In 1993 it was also the end of the seven year EU 'honeymoon' transition period, during which the country's tariffs and quotas on EU imports were phased out, thus exposing the economy to the full force of EU competition. Huge investment was needed for Spain's infrastructure, including roads, railways, airports, water supply and communications and the country received $22.8 billion between 1995 to 1999 from the EU specifically for this purpose.