GDP generated by the economy of the A.C. of the Basque Country registered 4.1% real growth in the fourth quarter of 2006, in relation to the same period of 2005, according to EUSTAT data. This inter-annual growth rate was point one per cent higher than that obtained by the Spanish economy (4.0%) and point seven per cent higher than that estimated for the EU-27 and for the USA (3.4%).

The inter-quarterly increase for the fourth quarter of 2006, compared to the third one, stood at 0.4%. This inter-quarterly variation was 1.1% for the Spanish economy and 0.9% both for the American economy and the European Union-27 average.

Graph 1. GDP market prices. Inter-annual growth rates. (%)

Data corrected for seasonal and calendar effects.

Source: Quarterly Economic Accounts, Eustat. State Data: INE. EU-27 Data, Euro Zone-13 and USA: Eurostat.

From the perspective of the supply sectors, as has been the case in recent quarters, the Construction sector retained its impetus in the fourth quarter of the year. With an inter-annual rate of 4.9%, it continues to be the most active sector, above the average for GDP. Inter-quarterly growth for this fourth quarter showed an upward trend of 1.9%.

The Industrial Sector, with an inter-annual rate of 4.6%, demonstrated a high level of activity, which was also above the average for GDP in the fourth quarter of the year, based on the momentum of exports of industrial goods overseas.

Table 1. GDP market prices. Supply. Chain volume indices. Inter-annual growth rates. A.C. of the Basque Country

Data corrected for seasonal and calendar effects.

Source: Quarterly Economic Accounts. Eustat

Market Services achieved 3.7% inter-annual growth, which was an identical rate to that recorded in the third quarter of the year. However, the inter-quarterly trend shows a rise of 1.2% compared to 0.6% from the previous quarter. Non-market Services showed upward evolution in inter-quarterly terms and also in inter-annual quarterly growth in the second part of the year. As a result, each quarter saw the Services sector consolidate inter-annual growth throughout 2006, recording 3.6% growth in the last quarter.

The Primary Sector registered a positive inter-annual variation of 7.5%, much higher than in previous quarters, even though in inter-quarterly terms we see a 7.7% fall compared to the third quarter of the year.

From the point of view of Demand, inter-annual growth of GDP in the fourth quarter was buoyed up, once more, by Internal Demand, whose inter-annual evolution was 4.5%, which was also accompanied by a less negative contribution from the overseas balance than the one seen in the fourth quarter of 2005. Total Exports grew by 8.3% and total Imports increased by 8.8%, with regard to the same period of the previous year.

Household Final Consumption Expenditure, Private Consumption, grew by 3.9% in the fourth Quarter, point two per cent less than the previous quarter. On the other hand, if we compare the inter-quarterly figure, a slight acceleration can be seen from the third quarter rate of 0.5% to 0.6% at the end of the year.

Public Administration Final Consumption Expenditure, Public Consumption, obtained an inter-annual growth rate 2.9% in the fourth quarter, two tenths more than the previous year, showing a pattern of slight acceleration not only for the inter-annual rate but also for the inter-quarterly one, compared to the third quarter of 2006.

In the fourth quarter of 2006, the most dynamic factor as regards Internal Demand was, once more, Gross Formation of Capital, which is to say Investment. In 2004, inter-annual rates for all four quarters surpassed growth of 7.0% and the last eight quarters passed the 6.0% inter-annual barrier. In addition, the inter-quarterly rate showed an upward trend, with a rise of one percentage point.

The number of Employed Personnel grew by 2.1% compared to the fourth quarter of 2005 and over the same period, if compared to the third quarter of 2006, grew by 0.2%. The Construction and Services sectors, with inter-annual growth of 3.2% and 3.1% respectively, were the contributors to the final positive balance.

Table 2. GDP market prices. Demand. Chain volume indices. Inter-annual growth rates. A.C. of the Basque Country

Data corrected for seasonal and calendar effects.

Source: Quarterly Economic Accounts. Eustat

Turning to the evolution of GDP per Province, the fourth quarter of 2006 saw Gipuzkoa, with 4.4% inter-annual growth, ahead of Bizkaia with 4.1% and Álava, whose growth was 3.0%.

GDP of the A.C. of the Basque Country grew by 4.2% over 2006, bettering the rate achieved in 2005 by three tenths. In addition, it surpassed the Spanish economy rate (3.8%) by four tenths, that of the Euro Zone-13 (2.8%) by 1.4 percentage points and that of the European Union-27 (3.0%) by 1.2 points.

The greatest sector growth corresponded to the Construction sector, which managed a rate of 5.1% in 2006. Industry, with an annual rate of 4.8%, was the mainstay of the growth of GDP, thanks to its positive contribution to the economy as a whole. The Primary Sector registered a positive balance of 1.3%.

Services grew by 3.5%, below the GDP average (4.2%), drawing a distinction between Market Services (3.7%) and Non-Market Services (2.6%).

Internal Demand, which grew by 4.6%, was the main force behind the momentum of GDP in 2006, despite the negative overseas balance, largely thanks to the contribution of Investments, where there was a 6.3% increase.

Final Consumption (3.9%) is the product of two distinct elements in both evolution and volume. On the one hand, Private Consumption, which maintained a high level (4.1%), whereas Public Consumption was seen to be less active (2.9%).

As for territorial distribution of GDP in 2006, Gipuzkoa and Bizkaia, with 4.3% and 4.2% respectively, surpassed the Álava rate, which was 3.8%.