The Economist: Spain is the world's best economy in 2024

According to the British magazine The Economist, Spain has been the best-performing economy among the countries of the Organization for Economic Co-operation and Development (OECD) in 2024.

This analysis is based on five variables that are used as indicators to classify each of the 37 countries that are part of the think tank for the most developed economies: GDP, inflation, stock market performance, reduction in unemployment and fiscal balance.

GDP

The first indicator presented in the analysis is the gross domestic product (GDP), which the British magazine considers to be the most reliable measure of the general health of an economy.

In the case of Spain, The Economist recalls that annual GDP growth is on track to exceed 3 percent, driven by a strong labor market and high levels of immigration, two elements that increase economic output, it is claimed.

In contrast, other neighboring countries have more negative figures in this regard. For example, Germany and Italy, whose GDP growth has stagnated due to high energy prices and slow production in the manufacturing industry.

Unemployment

Unlike the countries of North America, Europe, and especially the southern countries of the continent, has reached historically low unemployment levels.

It is Greece, Italy and Spain where unemployment has fallen to its lowest level in more than a decade. Specifically, Spain ended November with 2,586,018 unemployed, the lowest figure for this month since 2007.

However, Italy has achieved the best record in this regard, reducing the figure by 1.4 percent since the beginning of 2024. Unemployment in the United States and Canada has increased slightly.

Stock market

The state of the stock market is another of the indicators that the magazine uses to draw up the ranking. In Spain, the IBEX 35 closed last Tuesday above 11,900 points, registering an increasing annual variation of almost 17 percent.

Among the international markets, The Economist highlights the US and Canadian stock exchanges as the two best performers this year. It also specifically mentions the Nilkkei 225, the Japanese stock market, which reached a record high in 2024.

Although it also points out economies with negative values ​​in this sense: these are the markets of Finland and South Korea, which recently plunged in the wake of the political crisis in the country.

Core inflation and fiscal balance

The next indicator that The Economist uses is core inflation, which excludes energy and food prices. If we look only at the November figure for Spain, the INE estimates the figure at 2.4 percent, and the annual change has fallen by 0.1 percentage point.

However, despite the fact that global inflation has fallen significantly, prices in the service sector remain high in countries such as the UK and Germany, according to the British magazine.

Finally, the magazine points out the fiscal balance of OECD countries, with Denmark and Portugal standing out for having achieved exceptional budget surpluses, and Norway and Ireland due to oil revenues and corporate taxes, respectively.

Spain's tax burden fell in 2023 for the third year in a row, doing so more strongly than the OECD average.

The ratio between the weight of taxes and social contributions and the size of the Spanish economy fell by three-tenths of a percentage point, compared to a fall of one-tenth of a percentage point for the think tank for the most developed economies as a whole.

Prime Minister Pedro Sánchez celebrated the publication of The Economist article during the government control session in Congress on Wednesday, saying, “Spain is experiencing one of its best moments in recent decades,” Sánchez said from his seat.