GDP per head of population has dropped in the Balearics since the start of the century.

26-08-2016

A theme of the current regional government and of vice-president and tourism minister Biel Barceló in particular is that the Balearics, despite the contribution made by tourism, have suffered in terms of overall economic well-being.

A comparative analysis of Spain's regions shows that the Balearics have slipped from third to seventh with respect to GDP per inhabitant. In 2000 the Balearics could boast a per head of population rate of just over 20,000 euros, not far behind Madrid and Navarre in positions one and two and over 4,000 euros higher than the national average. By 2015 the Balearics were still above that average but only by something over 1,000 euros. The 24,394 euros per inhabitant was well short of the 31,812 of Madrid (still at the top). The other regions in the top seven in 2000 - Aragon, the Basque Country, Catalonia and La Rioja were the other four - have either stayed where they were (La Rioja, sixth), fallen one spot (Navarre) or gone up. The Balearics decline of four places is striking.

The government insists that this decline is a reflection of the state financing system; the Balearics receive far less than is contributed by tax revenue. Because of the decline, the financing system needs to be readdressed. It will also maintain that there is less equality in terms of general wealth than was once the case.

In fact, if one goes back to 1993, the Balearics were at number one position; even above Madrid. So what has happened? There are different factors to consider. Between 2000 and 2015 the population of the Balearics grew at a rate of double the national average. While this didn't automatically have to mean a diminution of per capita GDP because of a greater spread of population, it was allied to a generally lower level of productivity compared with other regions. Two indicators of competitiveness - human resources and technological innovation - are below those of most other regions.

Offsetting these, however, is the fact that prices in the Balearics are generally higher than elsewhere. Despite this, consumption has held up, suggesting that underlying economic welfare is an as reasonable condition as it used to be when the Balearics were higher up the rankings. For the government, however, the belief is that this consumption capacity welfare is far too unevenly distributed.

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