Recession in Majorca by year's end.

Recession in Majorca by year's end.

07-04-2020Jaume Morey

The Balearic economy has lost 335 million euros and 1.1% of GDP in three weeks because of the coronavirus crisis, according to Fundació Impulsa calculations.

During the first two weeks of the State of Emergency, the Islands shed 120.55 million euros and when non-essential activities were paralysed in the third week losses soared by another 214.30 million euros.

Antoni Riera, Technical Director for Fundació Impulsa estimates that the growth rate in the Balearic Islands for the first quarter of 2020 "will be negative”; second quarter will also close in the red because activity will not be fully recovered and that the Balearic economy will “go into recession” in the second half of the year.

Riera says it’s difficult to predict the economic recovery from this crisis but he is convinced that “the decisions taken will be key.”

He points out that the State of Emergency confinement “gives us time to look ahead, draw up scenarios and formulate the necessary contingency plans to get out of this situation as soon as possible”.

Fundació Impulsa’s Strategy Unit plans to launch working mechanisms this week to put together different actions based on public-private cooperation aimed at normalising economic activity, by reformulating current business models in the field of business viability.

The company advocates establishing conditions for the reopening of activity, starting with those oriented towards domestic demand, then extending them to other sectors.

Regarding Public Expenditure, Fundació Impulsa is committed to reallocating budget items and proposing a fiscal policy beyond the short term, that contemplates the future costs of obligations.

The fact that the Balearic Islands is almost entirely dependent on Tourism means it will likely be one of the last communities in Spain to recover from the coronavirus crisis.

The high season will probably be a total washout and a lot of hotels may not open at all, which will have a knock on effect on other businesses that focus solely on tourism.

The Hotel Association of Playa de Palma has asked the municipalities of Palma and Llucmajor to condone the payment of taxes and municipal taxes in 2020.

"We won’t be able to reopen if these expenses continue, we cannot have a mountain of taxes and municipal taxes in the drawer waiting to be paid and if the administration doesn’t do something the entire economy will be paralysed,” said, Isabel Vidal, Association President.

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kev parker / Hace 6 months

Last time we were in Majorca, there was crowds of people shouting tourists are terrorists.Also throwing eggs at buses. At least there will not be any holiday makers to annoy the locals.

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DavidG / Hace 6 months

The sun is the sun wherever a tourist will go. The main consideration will be what a euro buys and that will influence a destination. Majorca will be a long way down the list for many people and the island will then realise the level of the Goverment’s past stupidity

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MelB / Hace 6 months

You don't have to be an expert to state the obvious!

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Mark Badoer / Hace 6 months

So this government with their idiotic lock down measures, has brought a whole country and economy on its knees again. An economy which was just recovering from the last crisis. With 0,1% of the population actually having contracted the virus and with the knowledge 60% of people will get it anyway. Yes, yes, I know, it is all about the health services. Even so, I hope it was all worth it......I doubt it, the real battle is yet to begin.

+-13-

Stan / Hace 6 months

Scrap ALL TAXATION. When Flights can start coming to and from the Island. MAKE EVERYTHING HALF PRICE. Hotels, Bars,Restaurants, etc. NO TOURIST TAX. Then that will attract many Tourists desperate for a Holiday. The Tourists will be low on Money, because of Lockdiwn. So make a Two Hour Flight to the Sun , so attractive , thousands will fill Flights and Mallorca 's Economy will begin to recover.

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