The decline of private debt in Spain

Spain is one of the European countries where private debt has fallen the most.

According to the Bank of Spain, there has been a significant decline in the deleveraging of the private sector in recent years. Currently, our country has a surplus of savings compared to abroad exceeding 23 million euros (2% of the economy). Private debt is well below France or the Nordic countries.

The private sector has reduced its debt to pre-crisis levels. This is the result of the saving effort of companies and families, which accumulated surpluses of over 50,000 million annually during 2010-2017.

In addition, this situation strengthens the ability to respond to adverse situations that may occur in the future.

Will the saving effort remain? strong>

It is estimated that it is unlikely. Spanish households have been encouraged to consume and this translates into a decrease in their savings rate. It is also necessary to take into account the rising cost of oil and the negative impact that can be produced on the purchasing power of consumers.

On the other hand, business surpluses will not increase and a total capacity contradiction is expected. of financing of the private sector.

However, the high global debt is having an impact on the markets and this will affect Spain. Experts believe that the solution lies in consolidating the financial base of the expansion, creating conditions to increase productivity and quality employment.

Source of news: El País.

Source of the image.