The Bank of Spain published a speech by Governor José Luis Escrivá to the Banco de España-CEMFI-UIMP Conference on the Spanish Economy, framing migration and industrial policy as central to sustaining Spain’s recent growth outperformance in a more volatile global environment. The remarks also highlighted the need for stronger institutional quality to improve the design, delivery and accountability of public policy. Spain’s growth is described as slowing from rates above 3% to around 2.5% (annualised quarter-on-quarter) in the first half of 2025, with June 2025 projections revising GDP growth to 2.4% in 2025 and 1.8% in 2026 (down 0.3 percentage points and 0.1 percentage points versus March). The baseline scenario incorporates moderate US tariff hikes, including United States tariffs of 10% on the European Union without EU retaliation and 20% on China with symmetric retaliation, alongside a German defence and infrastructure fiscal impulse equivalent to 0.7% of euro area GDP over 2025-27 and 0.2% of Spanish GDP in 2025. An adverse scenario with retaliatory tariffs and protracted uncertainty would lower Spanish GDP growth to 2.0% in 2025 and 1.1% in 2026, with inflation at 2.1% and 1.2% respectively. On migration, the speech notes almost 2 million net immigrants in 2022-24, a dependency ratio 3.2 points below the European average in 2024, and that 76% of jobs created since 2019 have been filled by foreign-born individuals, with registrations rising most in accommodation and food service activities and construction. On industrial policy, the speech stresses dilemmas between competition and scale, efficiency and social cohesion, and autonomy and diversification, and calls for rigorous ex ante and ex post assessment, transparency, stable regulatory environments and policy continuity, against a backdrop of high regulatory complexity including an estimated 12,000 rules a year across Spain’s tiers of government.
Bank of Spain 2025-07-03
Bank of Spain Governor Escrivá sets out how migration and industrial policy governance shape Spain’s growth outlook under trade uncertainty
The Bank of Spain's Governor José Luis Escrivá emphasized migration and industrial policy as key to sustaining Spain's economic growth amid global volatility at the Banco de España-CEMFI-UIMP Conference. Spain's GDP growth is projected to slow to 2.4% in 2025 and 1.8% in 2026, with potential further declines under adverse scenarios involving retaliatory tariffs. The speech highlighted the significant role of foreign-born individuals in job creation and stressed the need for robust policy assessments and regulatory stability.