Analyse
Forget Germany. Spain is now an economic success model in Europe. Lighting.
Follow meA dozen years ago, one would have thought that a curse had fell on the Mediterranean countries: during the Euro crisis, They have been treated as “pigs” in allusion to the English acronym formed by the initials of Portugal, Italy, Greece and Spain. The newspaper Bild Asked the Greeks to sell islands to reduce their public debt, while the German economist Hans-Werner Sinn calculated for his compatriots the hundreds of fictitious billions that these same pigs should supposedly via the Target 2 system ( Go know why).
The new world order that is also prompted to upset economies in Europe. Suddenly, those in the North have come close to recession, and this for several years already. While the Mediterranean countries complain of a shortage of skilled labor.
The Pigs boom
The figures impress: since 2020, the gross domestic product (GDP) of the pigs increased on average by 1.5% per year and 6% in total. Meanwhile, Germany, the first economy of the continent, has recorded practically zero growth and stagnation should continue this year. In the countries of the Benelux also, the situation is far from pink.
Three reasons allow us to understand why the wind turned:
- Mediterranean countries have made major reforms. They did so partly under the pressure of Brussels, because it was the only way for them to access the assistance funds unlocked by the EU after the pandemic. These reforms were even greater than money, explains for example Yannis Stournaras, the governor of the Greek Central Bank, in the Financial Times.
- The pigs have received a disproportionate part of this same aid fund.
- The configuration that takes shape will also impose a new world economic order. It will penalize countries which mainly rely on export.
The positive evolution in Spain, and negative in Germany, perfectly illustrates this. The former export champion is now in agony, the German economic model having collapsed. Above all, the increase in energy prices caused by the war in Ukraine. The steel, automotive and chemical industry had all benefited from the cheap Russian gas before.
VW, symbol of the German crisis.Image: keystone
The heart of the German economy, the automotive industry, is particularly in bad shape. China once represented the largest export market for VW and the others. But today Byd, in particular, is one of the largest competitors on the market. The Germans purely and simply missed the transition to the electric motor.
Even medium -sized companies, so much tuned, have lost their superb. They “were limited to small innovations”, notes The Economist.
“They were therefore not prepared for technological shocks such as the arrival of electric vehicles”
But it’s not just the cost of energy to take into account. German engineering is always at the forefront for analog, but it has lost its hand for digital. The last start-up to have succeeded was SAP and its software, and it was founded in the early 1970s.
It is very different in Spain, which has turned into a model for its neighbors and beyond. Last year, Spanish GDP increased by 3.1%, even styling American growth at the post. And it is not a straw fire. The Central Bank tables in +2.5% for 2025.
The explosion of tourism is not the only reason for this progression. Spanish beaches and cities are certainly invaded by foreign holidaymakers – so much so that the Aboriginal people are beginning to protest against this “surcourism”. In general, the economy, it, well suited to the new deal.
- Sign of protest in Barcelona.Image: EPA EFE
While the Germans have bet on cheap Russian gas, the Spaniards have massively developed their solar and wind parks. More than half of total energy production now comes from sustainable sources. This does not only benefit the environment. “Another result: electricity costs much less than in many other EU countries,” notes the Financial Times.
And this leads societies like Amazon to move their energy centers in energy to Andalusia, thus creating thousands of new jobs.
Union will be strength
Unlike the Germans, the Spanish have, moreover, less to fear punitive customs rights wanted by Donald Trump. The share of services occupies a more important place in the Iberian economy than in the great power of the North. And the services are not in the sights of American customs officials.
We cannot blame southern Europeans to jubilant a little, because they keep in mind the insults suffered during the Euro crisis. However, they should quickly recover. If she does not want to be crushed by American and Chinese power, Europe will have no other choice – a new world order requires – than to unite even more. This is the conclusion of a report written by Mario Draghi, the former president of the European Central Bank, on behalf of the European Commission last fall.
Instead of exporting to all going across the Atlantic, Europeans should create their own large internal market, advises Draghi in a document of some 400 pages. To achieve this, you have to lift the last barriers on this market. It is only in this way that companies will benefit from economies of scale to the same extent as their American and Chinese competitors.
Mario Draghi calls on the unity of the old continentImage: keystone
European research capacities must also be more grouped. By analogy with the American model Darpa, the Italian offers the creation of an Arpas, a European Advanced Research Projects Agencies.
Another recommendation: unify the financial markets. This is the only way to make enough venture capital for start-ups. “Otherwise, there will be no Green Deal,” said Christian Sewing, the director of Deutsche Bank.
Finally, the austerity mentality must disappear. If Europe wants to remain competitive, it must untie the Stock Exchange Cordons. Draghi estimates that nearly 800 billion euros in additional investments are required each year. This will only become possible on the condition of Overcoming petty nationalist ideologies and almost religious belief in a debt brake.
(French adaptation: Valentine Zenker)
