Press Release 25/05/2016

QUARTERLY ACCOUNTS, I/2016

The GDP of the Basque Country registered 3.3% year-on-year growth in the first quarter of 2016

Growth was 0.8% compared to the previous quarter

GDP of the Basque Country saw growth of 3.3% in the first quarter of 2016 with respect to the same quarter of the previous year, according to Eustat data. This is equivalent to an increase of two tenths on the growth registered in the preceding quarter. With regards to the previous quarter, the variation was 0.8%. This annual rate is one tenth more than the variation estimated in the Advance Quarterly Accounts from the 27 April, though the estimated quarterly variation was maintained.

Growth of the Basque economy was one tenth lower than that of the Spanish economy in year-on-year terms, but it was 0.8% greater than the Eurozone-19 (+1.5%).

From the point of view of supply, the year-on-year growth in GDP was due to the positive performance of all activity sectors, except the construction sector.

Hence, the primary sector recorded a growth rate of 9.3%, which was slightly more moderate than the rate recorded the previous quarter. Industry, on the other hand, underwent an upwards trajectory, especially during the second quarter of 2015, as represented this quarter by a greater year-on-year rate than the rate recorded the previous quarter. The construction sector, however, failed to post positive rates, though its rate of fall was more restrained. The services sector as a whole has maintained a positive, stable level of activity since the last quarter of 2014. This fact is especially significant in the Trade, Hotel Management & Catering and Transport Sector, also known as Other Services, which includes professional activities, finance and insurance, among others. In services linked to Public Administration, Education, Health and Social Services, the growth rate was slightly lower.

In more detail, the Industry sector posted, in this quarter, a positive year-on-year growth rate of 4.8%, which is five tenths higher than that of the fourth quarter. In quarter-on-quarter terms, an increase of 0.1% was seen in this first quarter.

The Construction sector did not post a positive growth, falling 0.3% compared with the first quarter of 2015. This gave rise to a 2.5% decrease compared with the previous quarter.

Global activity within the Services sector recorded positive variations in both year-on-year terms and quarter-on-quarter terms: 3.0% and 1.3% respectively.

The year-on-year growth of 3.0% in Services is the result of all the positive performances of the subsectors, though to different extents: Other Services - which comprises, amongst other activities, professional, financial and insurance activities - grew at a rate of 3.4%. This was followed by the Trade, Hotel Management & Catering and Transport branch, which posted a rate of growth of 3.1%, with the Public Administration, Education, Health and Social Services branch coming in last place with growth of 2.2%.

Regarding quarter-on-quarter variation, it is worth noting that all subsectors registered positive growth rates, with services linked to Public Administration, Education, Health and Social Services registering the highest quarter-on-quarter growth rate, at 2.4%. The branches of both Trade, Hotel Management & Catering and Transport and Other Services also posted positive rates, of 0.7% and 1.1% respectively.

The aggregated performance by sector has led to a rise in Added Value of 3.3% in year-on-year terms, maintaining the upwards trajectory registered throughout 2015. This is an improvement of two tenths over the year-on-year figure of the previous quarter. There was also a 0.9% rise in the quarter-on-quarter rate, for the tenth consecutive quarter.

From the point of view of Demand, the positive growth rates of Internal Demand were consolidated with growth of 3.1% in year-on-year terms, an increase of three tenths on the previous quarter. Furthermore, this positive performance is reflected in its two components, Final Consumption Expenditure and Gross Capital Formation. With regards to the foreign sector, it is worth noting some higher levels of growth in export levels with regards to imports, i.e. the positive contribution of the foreign balance.

The annual growth rate of Household Final Consumption Expenditure (Private Consumption) accelerated, and reached a rate of 3.3% - two tenths more than the previous quarter - which gave rise to a 0.5% growth in the quarterly rate.

Public Consumption (Final Consumption Expenditure of Public Administrations) grew by 2.4% in year-on-year terms (six tenths more than in the previous quarter), which means a quarter-on-quarter growth rate of 7.0%.

The overall performance of the Final Consumption Expenditure of Public Administrations and the Final Consumption Expenditure of Households led to an upturn of 3.1% in Final Consumption Expenditure. With regards to the previous quarter there was an upturn of 1.8%.

Gross Capital Formation (Investment) grew at a positive year-on-year rate of 3.4%, eight tenths more than that registered in the previous quarter. It fell at a quarterly rate of 0.2%. Once again this overall performance of investment was based on two trends of different intensity. The variation of investment in capital goods showed a more positive trend, with a year-on-year growth rate of 10.7%, which equates to a quarterly increase of 2.4%. The rest of Gross Capital Formation, which is more closely related to the performance of the construction sector, also posted positive results in the year-on-year rate (0.2%), but a decrease of 1.4% in the quarter-on-quarter rate.

As regards the level of employment (measured in Full-Time Equivalent Jobs), there was an overall increase in the level of employment of 1.9% in year-on-year terms. By sector, there was a positive rate in all the activity sectors except for the construction branch. The Services sector stands out due to its volume, growing at an annual rate of 2.3%, though the growth rate was more restrained than in the previous quarter. The industrial sector also grew at a rate of 1.2% for the second consecutive quarter compared to the growth rate of 0.6% in the fourth quarter of 2015. The primary sector grew by 0.7%, but the construction sector did not. Instead, it saw its annual rate decrease by 0.3%.

In quarter-on-quarter terms, it grew by 0.3%, and all activity branches posted positive figures except for the construction branch. The primary sector grew by 0.5%, which was the same rate recorded by the services sector, and industry rose by 0.4%. Construction, however, decreased by 3.0%.

In terms of the variation in GDP by Province, Álava posted the highest year-on-year growth rate at 3.6%, with Bizkaia growing by 3.3% and Gipuzkoa by 3.1%. In quarter-on-quarter terms Álava was up by 0.9%, Bizkaia by 0.8% and Gipuzkoa by 0.7%.

For further information:

Eustat - Euskal Estatistika Erakundea / Instituto Vasco de Estadística C/ Donostia-San Sebastián, 1 01010 Vitoria-Gasteiz Press Service: servicioprensa@eustat.eus Tlf: 945 01 75 62 More press releases on the quarterly accounts of the Basque Country (CET) Quarterly accounts of the Basque Country. Databank (CET)