The Basque economy closed 2004 with a 3.0% average real growth rate in GDP, according to EUSTAT data. This growth bettered by half a point that registered in 2003, when the real growth rate was 2.5 %.

By analysing the inter-annual quarterly evolution throughout 2004, a slight loss of momentum can be seen in the fourth quarter in relation to the rates calculated for the first three quarters, but even so, there was inter-quarterly growth of 0.7% in relation to the third quarter of 2004.

From the point of view of Supply, the sectorial evolution highlights important differences, although all sectors concerned made a positive contribution to the growth of GDP of the A.C. of the Basque Country.

The most positive inter-annual growth was shown by the primary sector, with 15.1% in 2004, returning to the level of 2001, following the important backward step of 2003. Industry also presented a much more active profile in 2004 compared to the previous year: annual growth was 2.4% compared to a lesser rate of 1.4% a year earlier.

Construction grew point two percent less than in 2003 (3.7% in 2003 and 3.5% in 2004) and furthermore, the trend showed a slow-down over the four quarters of 2004.

The services sector obtained significant growth of 2.8% in 2004, despite this being two tenths less than in 2003, and was the sector to contribute most to net job creation.

As regards Demand, internal demand was seen to grow by a real rate of 2.7%, one tenth less than the previous year. The external balance, therefore, made a positive contribution to GDP, reversing the pattern of the previous year, when growth of internal demand was higher than that of GDP.

Final Home Consumer Spending, which had grown by a rate of 2.5% in 2003, grew by 2.4% a year later; elsewhere, Final Public Administration Spending also diminished, but reached a real growth rate of 3.1%.

Gross formation of capital -investment- improved its inter-annual growth rate by a point one percent (from 3.1% in 2003 to 3.2% in 2004) and softened a greater reduction of internal demand.

The overseas sector exterior performed dynamically and it can be seen that the favourable evolution of the overseas trade of industrial goods during the first six months of 2004 was confirmed in the second half of the year; both total exports (9.0%) and imports (8.3%) achieved growth rates well above those recorded the previous year of 0.9% and 1.4% respectively.

The economy of the A.C. of the Basque Country maintains a positive balance as regards job creation and the number of personnel employed rose 1.7% in relation to 2003, with 15,000 net jobs being created.

Growth in GDP, calculated to be 3.0% for 2004 and the evolution of annual employment, whose growth rate was 1.7%, gave rise to a significant improvement in the apparent productivity of the work factor, which came to 1.3%, compared to 0.6% the previous year.

By province, the growth of the economy in Alava was greater than in the other two provinces, growing at a rate of 4.6% compared to one of 2.7% in Bizkaia and Gipuzkoa. This higher growth rate of GDP in Alava in 2004 was due to the important activity carried out by the agricultural and industrial sectors and the fact that during the previous year it was the province with the least growth.