Tourists arriving at Palma Airport.

Tourists arriving at Palma Airport.

05-08-2020Ultima Hora

The Balearic Islands has the worst economic outlook in Spain this year. Gross Domestic Product, plummeted by 26.4 percent during lockdown, and 30.1% in June, year-on-year, according to the latest data from the Independent Authority for Fiscal Responsibility, AIReF.

It’s the worst economic collapse in history for the Balearic Islands and could cause a massive drop in household wealth.

Ministry of Economic Model & Tourism Representatives say what happens in August September and October will determine how the financial year ends.

Fluctuation

If coronavirus data remains stable and a certain level of tourism can be maintained, it’s possible that the end result will be better than expected, but the Government claims it’s impossible to predict what will happen because uncertainty is causing continuous fluctuation.

The AIReF Report forecasts the absolute worst for the Balearic Islands in terms of quarterly variation and annual drop, putting it in the same bracket as Valencia which has a quarterly drop of 22.1% and an annual decline of 25.6%.

AIReF estimates a second quarter fall of 18%-22% year-on-year in Spain.

Tourism suffered more than any other Sector during lockdown and since the Balearic Islands is 80% dependent on Tourism, it is one of the worst affected Communities in Spain and the paralysis of tourist activity is dragging the entire global economy behind it.

The collapse of economic activity will also affect GDP and Government income next year, because tax collection will drop alongside the economy and budgets are likely to be trimmed right back to the bare bones.

Comments

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Borja Laraudogoitia Rubio / Hace 12 months

Could you please send me a link to the source of this report?

Best, BL

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Mark Badoer / Hace about 1 year

People here can minus my comments all they like, but the truth is out there. Read the article in El Pais in english, about why Spain is so badly affected. It is very interesting and explains the reasons behind why Spain has been failing to get a grip on many fronts, eventhough Spain has a highly rated health system.

https://english.elpais.com/society/2020-08-07/medical-experts-call-for-independent-review-of-spains-coronavirus-response.html

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Mark Badoer / Hace about 1 year

Let's all thank our wonderful governments, both local and national for handling this corona crisis so well and totally NOT taken the people of Spain and their livelyhoods into account. Thank you for this economic melt down. But at least the hospitals were not overwhelmed. So mission accomplished.

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