Press Release 16/05/2014


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The GDP of the Basque Country registered 0.3% quarter-on-quarter growth in the first quarter of 2014

Internal Demand gave the first positive contribution to GDP after twelve negative quarters

In the first quarter of 2014, the GDP of the Basque Country registered a positive quarter-on-quarter variation of 0.3%, thereby consolidating the rate registered in the previous quarter, according to data drawn up by EUSTAT. This variation is one-tenth lower than that registered by the Spanish economy, according to the estimate published by the National Statistics Institute (INE).

With respect to the same quarter of the previous year, GDP in the Basque Country grew by 0.4%, after nine negative year-on-year rates. This year-on-year increase was two tenths lower than that registered by the Spanish economy (0.6%).

From the point of view of supply, the year-on-year increase in GDP is the combined result of opposing trends in the four large activity sectors. Both the industrial sector and the global performance in the services sector showed improvements in their levels of activity, whilst on the other hand, both the primary sector and construction continued to show setbacks in the generation of added value.

The Primary sector registered a year-on-year fall of 1.3%, which, in turn, led to a quarter-on-quarter drop of 9.5%.

This quarter the Industry sector registered a growth rate of 0.5%, which meant an improvement of zero point five percent over the year-on-year figures of the fourth quarter, and the second consecutive quarter with positive year-on-year growth rates. This figure for year-on-year performance corresponds to a growth of three tenths in quarter-on-quarter terms, which has meant an extra quarter, the fourth in a row, in which the sector has achieved a positive quarter-on-quarter variation (0.3%). It was once again the manufacturing industry that obtained both year-on-year and quarter-on-quarter positive variations.

Table 1. GDP m/p. Supply. Chain volume indexes. Year-on-year growth rates. Basque Country. %
Source: Eustat. Quarterly Economic Accounts

The Construction sector once again showed signs of contraction in year-on-year terms with a fall of 1.4%, two tenths of a percentage point less negative than the previous quarter. The growth rate compared to the previous quarter was also negative, at -2.7%.

Global activity within the Services sector recorded positive variations in both year-on-year terms and quarter-on-quarter terms: 0.6% and 0.8% respectively.

Table 2. GDP m/p. Supply. Chain volume indexes. Year-on-year growth rates. Basque Country. %
Source: Eustat. Quarterly Economic Accounts

The year-on-year rise of six-tenths in services is the result of different trends within its sub-sectors: the activity level of theTrade, Hotel Management & Catering and Transport sector was down 0.2%, while both the so-called Other Services - including, among other things, professional activities, finance and security - and Public Administration, Health and Social Services registered positive variations of 0.4% and 1.9% respectively.

Regarding quarter-on-quarter variation, the positive growth of all subsector activities was noteworthy. The Trade, Hotel Management & Catering and Transport sector as well as Other Services posted a growth of 0.2%, with the services connected to Public Administration, Education, Health and Social Services registering a greater quarter-on-quarter growth, at 2.7%.

The aggregated performance by sector has given rise to a positive evolution of Added Value of 0.4% in year-on-year terms, the first positive growth figure for added value after nine consecutive downturns. This is an improvement of seven-tenths over the annual figure of the previous quarter. There was also a 0.3% rise in the quarter-on-quarter rate, for the second consecutive quarter.

Table 3. GDP m/p. Demand. Chain volume indexes. Year-on-year growth rates. Basque Country. %	
Source: Eustat. Quarterly Economic Accounts.

From the point of view of Demand, there are two significant issues. The first is a slight positive evolution in Internal Demand, at one percent, which has not occurred since 2010. The second issue is that, as in previous quarters, the evolution in Internal Demand was more measured than that of GDP, resulting in a positive contribution by the external sector to economic growth. There was a slight upturn in export levels combined with a more moderate variation in import levels.

Household Final Consumption Expenditure (Private Consumption) showed a positive year-on-year performance for the first time since the end of 2010, at two tenths of a percent. For the second consecutive quarter, the evolution with respect to the previous quarter was also positive (0.1%).

Public Consumption (Final Consumption Expenditure of Public Administrations) also showed more positive figures than those of the previous quarter. The year-on-year rate grew by 1.0% and the quarter-on-quarter rate, by 7.9%.

The overall performance of the Final Consumption Expenditure of Public Administrations combined with the Final Consumption Expenditure of Households led to a upturn of 0.3% in Final Consumption Expenditure. With regards to the previous quarter there was also a upturn, 1.8%.

Gross Capital Formation (Investment) again decreased, both in year-on-year terms (-1.1%), and in quarter-on-quarter terms (-2.0%). This overall performance of investment was based on two opposite trends. The evolution of investment in capital goods had positive results with a year-on-year growth rate of 0.4%, which also meant a positive quarterly rate, of 0.9%. On the other hand, the rest of Gross Capital Formation, which is more closely related to the evolution of the construction sector, posted negative results, both in the year-on-year rate (-1.7%) and quarter-on-quarter (-3.2%).

Internal Demand, composed of Final Consumption Expenditure and Gross Capital Formation, posted a positive variation in year-on-year terms of 0.1%. This is a new, given the negative evolution seen in previous quarters.

Table 4. GDP m/p. Demand. Chain volume indexes. Year-on-year growth rates. Basque Country. %	
Source: Eustat. Quarterly Economic Accounts

The contribution of the Foreign Sector to GDP evolution was again positive. The comparatively better evolution of the foreign balance in relation to the evolution of Internal Demand occurs with year-on-year positive performance of 3.4% within Exports of goods and services, compared to growth in Imports of 2.6%.

The evolution of the GDP generated a new year-on-year drop in the employment level, measured in Full-Time Equivalent Jobs. The fall in employment in year-on-year terms was recorded as 0.5%, whilst in quarter-on-quarter terms, a descent of 0.1% was registered.

Employment levels performed negatively in relation to the same quarter of the previous year in all sectors of activity except for Services. The greatest year-on-year decrease occurred once again in Construction, which fell by 4.9%, followed by the Primary sector (-2.4%) and Industry (-2.0%). The Services sector grew at a rate of 0.4%. The quarter-on-quarter rate evolved negatively both for the Primary sector and for Industry and Construction. The Primary sector fell by 1.5%, Industry by 0.7% and Construction by 3.2%. Only the Services sector generated employment in the quarter-on-quarter rate (0.3%).

Regarding the evolution of GDP by Province, in year-on-year terms Bizkaia showed the smallest growth, of 0.2%, followed by Álava with 0.5%, while Gipuzkoa achieved the highest level of GDP growth with a rate of 0.7%. In quarter-on-quarter terms Álava was up by 0.4%, Bizkaia by 0.3% and Gipuzkoa by 0.1%.

For further information:

Eustat - Euskal Estatistika Erakundea / Instituto Vasco de Estadística C/ Donostia-San Sebastián, 1 01010 Vitoria-Gasteiz Press Service: Tlf: 945 01 75 62 More press releases on the CET - Quarterly Economic Accounts of the Basque Country Quarterly Economic Accounts of the Basque Country databank

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The GDP of the Basque Country registered 0.3% quarter-on-quarter growth in the first quarter of 2014

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1er trimestre de 2014
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Departamento de Desarrollo Económico e Infraestructuras

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