Economic growth in the Balearics last year was 3% and is forecast by the regional government to rise to 3.5% in 2016: GDP has been revised upwards because of good performance in the last quarters of 2015 and the first quarter this year.
"These high growth figures are equivalent to those pre-crisis," said Iago Negueruela, minister for employment, trade and industry yesterday: he was presenting the April report into the islands' economic situation together with the director-general for economic affairs, Llorenç Pou.
The minister observed that growth is being driven by tourism performance, which is being felt by other sectors of the economy. He noted, however, that growth did not yet mean higher wages. Pou said that at present salaries are showing very little change - increases of up to 0.5% - and that they had not matched the pace of growth in 2015. Negueruela added that the government has put in place a plan to boost competitiveness with unions and business associations in order to ensure that macroeconomic recovery translates into greater welfare.
The government considers that further recovery will come through more hours being worked. Pou pointed out that an increase in the total number of hours is already at a level that was not reached during the years of recession. Negueruela stressed that part of economic growth was contributing to an increase in business incomes and that these, in many instances, were going towards investment. He cited the example of the hoteliers, which have been modernising their establishments. "WIth these investments, productive capacity is increased."
The government is pushing for an increase in salaries in order to stimulate internal demand, albeit that data related to consumption by residents show a rise; examples of this including increased IVA (VAT) collection and a rise in the number of cars being bought.
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