COMMISSION STAFF WORKING DOCUMENT In-depth review for Spain Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN CENTRAL BANK, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK 2023 European Semester – Spring Package
Date: 2023-05-24
Institutions: European Commission, Secretariat-General
Subjects: European Semester, Spain, competitiveness, economic policy, indebtedness, macroeconomics, self-sufficiency in energy, tourism, unemployment

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 24.5.2023  SWD(2023) 632 final  COMMISSION STAFF WORKING DOCUMENT In-depth review for Spain Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN CENTRAL BANK, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK 2023 European Semester – Spring Package {COM(2023) 600 final} - {SWD(2023) 628 final} - {SWD(2023) 629 final} - {SWD(2023) 630 final} - {SWD(2023) 631 final} - {SWD(2023) 633 final} - {SWD(2023) 634 final} - {SWD(2023) 635 final} - {SWD(2023) 636 final} - {SWD(2023) 637 final} - {SWD(2023) 638 final} - {SWD(2023) 639 final} - {SWD(2023) 640 final} - {SWD(2023) 641 final} - {SWD(2023) 642 final} - {SWD(2023) 643 final} - {SWD(2023) 644 final}  
 
 
Spain 

In-Depth Review 2023 

 
 
 
 
 
 
 
 
 
 
 
On  the  basis  of  this  in-depth  review  for  Spain  undertaken  under 
Regulation  (EU)  No  1176/2011  on  the  prevention  and  correction  of 
macroeconomic  imbalances,  the  Commission  has  considered  in  its 
Communication “European Semester – 2023 Spring Package” (COM(2023) 
600 final) that: 

Spain continues to experience imbalances. Vulnerabilities related to high private, 
government  and  external  debt,  which  have  cross-border  relevance,  are  receding 
but remain present. External debt and especially private debt ratios declined over 
the 2010s’ and, after a temporary interruption in 2020, resumed their decline in 
2021  and  are  expected  to  continue  declining  favoured  by  economic  growth. 
However, they remain at still elevated levels. The external position has benefited 
from  a  current  account  that  has  been  in  surplus  for  a  decade  even  if  it  has 
narrowed more recently reflecting the impact of the pandemic on tourism exports 
and  of  the  higher  energy  prices  in  2022.  The  government  debt  remains  high.  In 
2022,  it  has  resumed  the  downward  trajectory  that  delivered  improvements 
before  the  pandemic  driven  by  strong  nominal  GDP  growth,  but  remains  above 
pre-pandemic levels. At a more moderate pace, prospects are for a continuation of 
this reduction in 2023 and 2024, underpinned by policy measures in the RRP. The 
financial  system  showed  resilience  in  face  of  the  recent  shocks  induced  by  the 
pandemic and the energy crisis. Unemployment has been decreasing again, but it 
still stands high and pockets of vulnerability remain, including very high long-term 
and  youth  unemployment.  Potential  risks  affecting  the  further  narrowing  of 
vulnerabilities relate mainly to the impact of the tightening of financial conditions 
on  households  and  firms’  financial  positions  as  well  as  on  the  medium  to  long-
term  sustainability  of  government  debt  in  face  of  the  current  market  conditions 
and  population  ageing.  Policy  progress  has  been  favourable  and  continuing 
implementing the RRP should deliver further improvements.  

 
 
 
 
 
 
 
 
 
 
 
 
CONTENTS 

1.  Introduction 

2.  Assessment of macroeconomic vulnerabilities 

LIST OF TABLES 

Table 2.1: 
Table 2.2: 
Table 2.3: 
Table 2.4: 

Selected economic and financial indicators (Part 1), Spain 
Selected economic and financial indicators (Part 2), Spain 
Selected housing market indicators (Part 3), Spain 
Selected household debt indicators (Part 4), Spain 

LIST OF GRAPHS 

Graph 2.1:  NIIP projections 

Graph 2.2:  Selected graphs, Spain 

Graph 2.3:  Components of gross fixed capital formation deflator growth and consumer price inflation 

Graph 2.4: 

Impact of Spanish value added inflations on EU partners’ consumer price inflation 

4 

5 

14 
15 
16 
17 

6 

11 

12 

13 

 
 
 
 
 
 
 
1. 

INTRODUCTION 

In  2022,  over  the  previous  annual  cycle  of  surveillance  under  the  Macroeconomic 
Imbalance  Procedure  (MIP),  the  Commission  identified  “macroeconomic  imbalances”  in 
Spain. (1)  These  imbalances  were  related  to  high  external,  government  and  private  debt,  in  a 
context of high unemployment, and have cross-border relevance. The 2023 Alert Mechanism Report 
published  in  November  2022  concluded  that  an  in-depth  review  (IDR)  should  be  undertaken  also 
this  year  for  Spain  with  a  view  to  assess  the  persistence  or  unwinding  of  imbalances. The  AMR 
concluded  that  in  Spain,  concerns  related  to  household  and  non-financial  corporate,  government 
and  external  debt-to-GDP  ratios  remain,  although  they  resumed  their  declining  path  after  the 
COVID-19  crisis  with  external  and  private  debt  falling  solidly  in  a  context  of  strong  nominal  GDP 
growth. The government debt-to-GDP ratio is very high and the fiscal deficit is sizeable, despite a 
slight improvement. The unemployment rate, while still high, is already below pre-crisis levels and it 
is expected to remain stable next year. (2) 

The  Spanish  economy  weathered  well  the  negative  shocks  caused  by  Russia’s  war  of 
aggression against Ukraine last year as real GDP posted growth of 5.5%. A moderation 
of  the  growth  rate  is  expected  in  2023. (3)  The  resilience  of  the  economy  in  2022  was 
underpinned by the strong rebound in tourism over the summer season and dynamism of private 
consumption, also supported by positive labour market developments and the relatively favourable 
position compared to other EU countries in terms of supply exposure to Russia. Economic activity in 
2023 is expected to expand by 1.9%. The full recovery of international tourism and the pick-up in 
investment after the sharp downturn in the second half of last year, along with the strong carry-
over  from  2022  are  expected  to  sustain  real  GDP  growth  this  year.  Driven  by  energy  prices, 
headline inflation averaged 8.3% in 2022 but declined to 5.7% y-o-y in 2022-Q4. It is expected to 
further  decelerate  in  2023  to  4.0%  mainly  due  to  the  moderation  of  energy  prices.  The  pass-
through to other goods and services accelerated considerably from the second half of last year and 
it will prompt core inflation to remain at elevated levels in 2023. Second-round effects on wages 
were  very  limited  last  year.  Nominal  wage  growth  is  expected  to  pick-up  in  2023.  Faster-than-
assumed adjustment would feed into higher core inflation over the forecast horizon. 

This  in-depth  review  presents  the  main  findings  of  the  assessment  of  macroeconomic 
vulnerabilites for Spain.  The MIP assessment matrix is published in the 2023 Country Report for 
Spain. (4) 

(1)  European Commission (2022), European Semester Spring Package 2022, COM(2022) 600 final. 

(2)  European Commission (2022), Alert Mechanism Report 2023, COM (2022) 381 final. 

(3)  European Commission (2023), European Economic Forecast: Spring 2023, Institutional Paper 200. 

(4)  European Commission (2023), Country Report Spain 2023, SWD(2023) 609 final. 

4 

 
 
 
                                                 
 
2.  ASSESSMENT OF MACROECONOMIC 
VULNERABILITIES 

Gravity, evolution and prospects 

The current account balance remained in positive territory in 2022, despite high energy 
prices,  underpinned  by the  strong  rebound  in tourism  activity.  Spain  has  posted  surpluses 
since  2012,  including  during  the  COVID-19  crisis  period.  The  positive  current  account  balance 
reached 1.0% of GDP in 2021, before moderating to 0.6% in 2022 (graph 2.2 a). The dependence 
of Spain on imports from Russia is limited and has exerted a marginal impact on the evolution of 
the country’s external position. The main transmission channel of the energy shock arising from the 
conflict  in  Ukraine  manifested  through  higher  import  prices.  Going  forward,  the  current  account 
surplus  is  projected  to  increase  to  1.6.%  in  2023  and  further  to  1.5%  in  2024,  favoured  by  the 
gradual reduction of energy prices and the expected improvement in the terms of trade conditions. 
In  addition,  the  revenue  accruing  from  tourism  is  set  to  lead  to  further  current  account 
improvements amid the complete recovery of international travel compared to pre-COVID-19 level. 
The current account balance remains however above the level required to reach the prudential net 
international  investment  position  (NIIP)  threshold  over  the  next  10  years,  estimated  at  –2.5%  of 
GDP, as well as above the level required to stabilise the NIIP above the threshold of -35% over the 
next 20 years, set at –1.1% of GDP. 

Spain’s  net  international  investment  position  (NIIP)  continued  to  gradually  improve  in 
2022, after a temporary deterioration in 2020, but remains below benchmarks. The NIIP 
has displayed a steady improvement since 2009, which has only been temporarily halted in 2020 
during the COVID-19 crisis, when it worsened by 12 pps to –85.7% of GDP. The NIIP resumed its 
upward  trend  in  2021  and  increased  to  –60.5%  of  GDP  by  the  end  of  2022.  While  it  remains 
negative and well beyond the fundamental NIIP benchmark (-30.9% of GDP), it nearly reached the 
prudential benchmark (-59.2% of GDP) (graph 2.2 c). Against this background, the composition of 
Spain’s external liabilities contributes to mitigate some of the vulnerabilities. A considerable share 
of external debt is composed of government debt and central bank debt (largely Target2 liabilities) 
resulting from monetary operations of the Eurosystem, which entails a lower refinancing risk than 
that  of  the  debt  held  by  the  private  sector.  Furthermore,  the  NIIP  excluding  non-defaultable 
instruments (NENDI), stood at -30.8% of GDP end of 2022 and its adjustment has been faster than 
that  of  the  NIIP.  Most  recently,  this  has  been  related  to  declining  liabilities  in  form  of  debt 
instruments, while over the longer term, improvements in NENDI were supported by the increasing 
liabilities in form of foreign direct investment (FDI), as well as increasing external assets in form of 
debt instruments. Overall, the adjustment perspective of the imbalance going forward is positive. 
The  NIIP  projections  suggest  that,  under  the  baseline  scenario,  the  NIIP  should  reach  levels  of 
around -29% of GDP by 2032 (see graph 2.1). Under alternative assumptions (scenarios 1 and 2), 
the NIIP should come between -20% and -37% of GDP. (5)  

(5)  The optimistic alternative scenario (scenario 1) assumes higher trade balances in 2025 and thereafter by 1 pp of GDP, and 
higher real GDP growth in 2025 by 1 pp of GDP, than in the baseline scenario. It illustrates a case of a more positive trade 
balance  evolution  amid  lower  energy  prices  and  better  export  performance  than  under  the  baseline.  The  pessimistic 

5 

 
                                                 
 
 
Graph 2.1: NIIP projections 

2. 

Assessment of macroeconomic vulnerabilities 

Source: European Commission services 

Private sector balance sheets have continued to strengthen in line with the recovery in 
economic activity in 2022. Thanks to strong GDP expansion up until the end of 2019, the debt 
ratio  of  the  non-financial  private  sector  remained  on  a  sharp  downward  trend  from  its  peak  of 
204% of GDP in 2009. The ratio reached 146% of GDP in 2020, up by 18 pps compared to 2019, 
before  moderating  again  to  125  %  of  GDP  in  2022.  The  adverse  consequences  of  the  spike  in 
corporate indebtedness resulting from the COVID-19 crisis have been limited, also for those firms 
operating  in  sectors  considerably  hit  by  the  economic  fallout  of  the  pandemic,  including  tourism. 
Further  private debt  deleveraging is  expected  over the  forecast  horizon  on the  back  of  sustained 
economic growth and moderate credit activity, amidst the significant financial tightening observed 
over the last year. The consolidated debt of non-financial corporations’ (NFCs) amounted to 72% in 
the  last  quarter  of  2022,  while  household  debt  totalled  53%  of  GDP.  Both  ratios  remain  above 
prudential  levels  and  fundamental  benchmarks  according  to  Commission  estimates  (graph  2.2  d 
and e). Also, pockets of vulnerability remain, and risks related to borrowers’ repayment capacity are 
rising reflecting weaker growth and tighter financial conditions in 2023. For households, despite the 
predominant extension of new mortgages at fixed rates in recent years, the stock of mortgage debt 
continues  to  be  highly  concentrated  on  variable-rate  loans  (above  60%),  with  households  highly 
exposed  to  rising  interest  rates  and  the  expected  repricing  of  the  mortgage  loan  book  over  the 
course of 2023. 

The  financial  sector  has  weathered well  the  pandemic and  the  fallout  from  the  war  in 
Ukraine  so  far,  although  higher  interest  rates  are  likely  to  put  strain  on  the  debt 
repayment  capacity  of  some  categories  of  borrowers.  Despite  the  slowdown  in  economic 
growth,  the  higher  inflation  and  interest  rates,  the  Spanish  banking  sector  remains  resilient.  In 
2022,  the  asset  quality  continued  improving,  the  liquidity  position  of  banks  has  remained 
reassuring and profitability improved markedly. The NPL ratio at system level dropped to 3.5% at 
the end of last year, which is the lowest level since March 2009, despite the expiry in June 2022 of 
debt moratoria and the grace period for loans granted by the Instituto de Crédito Oficial (ICO). The 
asset quality of the portfolio which benefitted from relief measures after the onset of the COVID-

alternative  scenario  (scenario  2)  describes  a  corresponding  adverse  shock  in  which  it  assumes  the  same  timing  and  the 
magnitude of deviations from the baseline, but with the opposite sign. 

6 

-80-70-60-50-40-30-20-1002122232425*26*27*28*29*30*31*32*% of GDPScenario 1Scenario 2Baseline  
 
                                                                                                                                                        
2. 

Assessment of macroeconomic vulnerabilities 

19 pandemic remains relatively stable, although refinanced loans, in particular those backed by ICO 
guarantees,  warrant  close  oversight.  The  authorities  approved  in  November  2022  borrower  relief 
measures  aimed  at  mitigating  the  impact  of  higher  interest  rates  on  borrowers  with  mortgage 
loans.  The  package  of  measures  has  modified  a  program  introduced  in  2012,  which  allows 
vulnerable borrowers to obtain more favourable mortgage conditions. Since the higher inflation and 
the  increase  in  interest  rates  is  likely  to  put  strain  on  the  debt  repayment  capacity  of  some 
borrowers, close oversight is warranted of the capitalisation of Spanish banks, which continues to 
be lower than for EU peers. 

After the steady decline of the government debt-to-GDP ratio since the pandemic, driven 
by nominal GDP growth, persistent structural deficits are expected to continue weighing 
on  its  downward  adjustment.  General  government  debt  has  declined  since  2020  favoured  by 
robust  GDP  expansion,  but  its  level  remains  elevated.  After  peaking  at  120%  of  GDP  in  2020, 
government debt declined to 113.2% in 2022 and is expected to narrow to 110.6% in 2023 and 
109.1% in 2024. Government revenues have shown considerable strength over the last two years, 
recording  double-digit  growth  rates,  but  the  structural  nature  of  this  recent  rise  is  unclear. 
Nonetheless, the  deficit  remains  high  and  the debt ratio  is projected  to  hover  around  113.8%  of 
GDP in 2033. Therefore, Spain would need to establish a credible consolidation path to bring down 
its structural deficit in the medium-term and anchor expectations of future fiscal developments. 

According to the Commission’s fiscal sustainability assessment, Spain faces high fiscal 
sustainability  risks  over  the medium term and  medium ones over  the  long  term (6).  The 
debt sustainability analysis shows that government debt is projected to remain at a high level in 
the baseline scenario. This debt path is sensitive to possible shocks to fiscal, macroeconomic and 
financial variables, as illustrated by alternative scenarios and stochastic simulations, most pointing 
to  high  risks.  In  a  context  of  an  already  elevated  stock  of  liabilities,  the  main  headwinds  ahead 
affecting  public  debt  developments  are  related  to  higher  interest  rates  and  the  increase  in  costs 
related  to  health  care,  long-term  care  and  pensions  due  to  population  ageing.  According  to  the 
Spanish Treasury, gross financing needs are projected at EUR 256.8bn (18.2% of GDP), increasing 
from EUR 232.6bn (17.4% of GDP) in the previous year due to higher redemptions of medium- and 
long-term debt. 

Structural  features  of  outstanding  Spanish  government  debt  in  terms  of  maturity  and 
investor base remain broadly supportive of debt sustainability. Over the past years, Spain 
has  issued  significant  amounts  of  longer-maturity  debt  and  thereby  the  average  maturity  of  the 
debt  stock  increased  to  eight  years  in  2021.  The  average  maturity  has  reached  its  peak  and  it 
appears  to  have  started  to  decline  gradually  in  2022.  Holders  of  Spanish  debt  remain  well 
diversified. In 2022, foreign investors’ share remained above 40% despite the gradually declining 
trend, while the Bank of Spain’s share was around one third and other resident investors held the 
rest. 

Labour market outcomes are improving, including reductions of the  unemployment rate 
and  the  share  of  temporary  employees  in  the  private  sector,  although  structural 
challenges remain. Following the 2021 labour market reform, new contracts signed during 2022 
point to a widespread reduction of the share of fixed-term contracts across all economic activities, 
falling overall to 62% from 90% in 2019 (the year before the COVID-19 pandemic). The share of 
temporary employees in the private sector fell to 14.8% in Q4 2022, down from 23.9% one year 
before. These developments have taken place in a context of significant resilience of job creation 
and further reductions of the unemployment rate, which decreased to 12.9% in Q4-2022, reaching 

(6)  See the DSA in the Commission Country Report 2023 for the latest risk classification and Debt Sustainability Report 2022 

(April 2023) for methodological details. 

7 

                                                 
2. 

Assessment of macroeconomic vulnerabilities 

the  lowest  record  since  2008  and  half  the  peak  level  reached  in  2013  (26.1%  in  annual  terms). 
These trends are expected to continue over the forecast horizon. However, the unemployment rate 
remains almost double the EU average, with structural pockets of vulnerability, including very high 
long-term and youth unemployment and there is still a high share of temporary employees in the 
public sector (30.2% in Q4-2022). 

Assessment of MIP relevant policies  

Since 2021, significant policy steps have been taken across several areas supporting the 
deleveraging process, while addressing structural challenges in the labour market. Policy 
progress  in  the  areas  affected  by  imbalances  is  being  favoured  primarily  by  the  wide-ranging 
reforms  and  investments  included  in  the  RRP,  covering  the  major  vulnerabilities  across  diverse 
policy fields. Ongoing interventions in the areas of public and private finances, business productivity 
and labour market are particularly relevant. 

A gradual consolidation of public finances, driven by a broadening of the tax base and 
more efficient government expenditure should help address Spain’s structural deficit. In 
this  regard,  Spain  has  started  to  implement  the  recommendations  of  the  spending  reviews 
published  in  2019-2020  geared  at  improving  the  efficiency  of  public  spending.  Annual  public 
expenditures  by  mainly  central  and  regional  governments  covered  in  these  spending  reviews  are 
estimated to  amount to  7%  of  GDP.  In  addition, measures  such  as  the modernisation  of  the  Tax 
Agency,  the  law  against  tax  evasion  and  fraud,  and  the  delivery  of  enhanced  assistance  to 
taxpayers through improved IT services are likely to have had an impact in reducing the size of the 
shadow economy, thereby partially contributing to the recent sharp rise in revenues. However, the 
structural nature of the recent rise in revenues is still unclear, which calls for fiscal prudence. Whilst 
a holistic tax reform, following the recommendations from a committee of experts is expected to 
be  undertaken  as  part  of  the  Plan,  some  already  adopted  measures,  such  as  a    two-percentage 
point  increase  in  insurance  premium  tax,  the  introduction  of  a  digital  services  and  financial 
transaction  tax  as  well  as  solidarity  contribution  by  wealthier  taxpayers, (7)  are  contributing  to 
reduce the government revenue gap vis-a-vis the EU average, in accordance with the objectives of 
the Plan. On the other hand, it will prove necessary to address the unfavourable initial budgetary 
position and future budgetary pressures stemming from population ageing related to health care 
and long-term care expenditure to ensure debt stabilisation. Furthermore, the relinking of pensions 
to  inflation  contributes  to  pension  adequacy  but  poses  additional  risks  to  fiscal  sustainability. (8) 
These  risks  are, however, partially mitigated  by  a  number  of  offsetting measures  included in the 
Plan. 

RRP measures are expected to contribute to addressing the high levels of private debt. 
SMEs  will  benefit  from  improved  access  to  finance  in  the  form  of  guarantees  via  the  ‘Compañia 
Española de Reafianzamiento’ (CERSA). CERSA will allow access to long-term financing and working 
capital,  which  will  help  address  businesses’  debt  overhang.  The  guarantees  are  expected  to  be 
granted  to  SMEs  by  end-2023.  The  Plan  also  includes  a  set  of  actions,  including  the  law 
establishing a new insolvency framework, which entered into force in 2022,  intended to facilitate 

(7)  The  fiscal  impact  of  the  solidarity  contribution  is  expected  to  be  limited,  at  some  0.1%  of  GDP  per  year  over  the  next 

decades.  

(8)  The  Commission  will  formally  assess  the  overall  long-term  fiscal  sustainability  of  the  package  in  the  context  of  Spain’s 
forthcoming fourth payment request of the Recovery and Resilience Plan. In line with the Council implementing Decision, 
this  assessment  will  take  into  account  the  impact  of  other  structural  reforms  included  in  the  plan,  including  the  labour 
market reform. 

8 

                                                 
2. 

Assessment of macroeconomic vulnerabilities 

preventive  debt  restructuring  and  debt  relief  for  natural  persons,  with  the  goal  of  preventing 
insolvency  situations  and  facilitate  resource  reallocation.  The  reform  also  makes  insolvency 
procedures  more  efficient  and  establish  a  dedicated  electronic  procedure  to  reduce  the  cost  and 
duration for micro-enterprises. The new insolvency framework already contributed to the increase 
of  voluntary  bankruptcy  filings  as  from  mid-2022,  with  the  base  number  being  still  very  low  in 
absolute terms. 

The reduction of energy dependency and higher competitiveness of the business sector 
would  support  further  corrections  in  external  imbalances.  Reforms  and  investments  are 
underway favouring higher energy efficiency and the wide-spread use and production of renewable 
energy. Meeting the targets of the national energy and climate plan can further reduce dependency 
on energy imports and contribute to gradually improving the external  debt ratio. Measures in the 
RRP  improving  the  business  environment  and  skills,  reforms  of  the  educational  and  vocational 
training  systems,  as  well  as  investments  in  strategic  sectors  and  supporting  the  digitalisation  of 
SMEs are set to strengthen the competitiveness of firms. 

Reforms promoted by the RRP are set to gradually address structural challenges in the 
labour  market  when  implemented.  The  reform  approved  in  December  2021  streamlined  the 
number of contract types, including stricter rules for hiring on a temporary basis and reinforcing the 
open-ended  contract  for  discontinuous  activities  (fijos-discontinuos).  These  measures  are  helping 
reduce  temporary  employment  in  the  private  sector,  favouring  the  correction  of  labour  market 
duality,  which  is  key  to  boost  labour  productivity  in  the  medium  to  long  term.  Building  on  the 
favourable experience of short-time work schemes (‘ERTEs’) during the pandemic, the 2021 reform 
package also included a permanent mechanism supporting firms and workers in transition to adjust 
to cyclical and structural shocks (Mecanismo RED), which became operational in April 2022. Further 
labour  market  reforms  in  the  RRP,  such  as  the  new  Employment  Law,  the  review  of  hiring 
incentives,  and  the  modernisation  of  Public  Employment  Services  (PES),  have  the  potential  to 
improve job-matching efficiency and address skill mismatches. This would eventually contribute to 
reducing high unemployment relative to the EU – particularly long-term and youth unemployment. 
Also  measures  in  the  RRP  shall  contribute  to  reducing  the  persistent  high  share  of  temporary 
employees in the public sector. 

Nonetheless,  shortcomings  in  business  regulation,  low  innovation  capacity,  and  skills’ 
shortages  continue  to  hamper  firms’  growth  and  productivity.  Further  efforts  to  boost 
productivity remains pivotal for Spanish enterprises and especially small and medium sized firms 
to increase their competitiveness and market share in domestic and foreign markets. In this regard, 
additional attention to improve the business environment, complementing the measures envisaged 
in the RRP reducing administrative burden and regulatory fragmentation, would be desirable to spur 
a more rapid deleveraging process. A multiplicity of size-dependent regulation measures could be 
reviewed to improve capital and labour allocative efficiency. Also, improving legislation quality and 
judicial efficiency, as planned in the RRP, would reduce economic distortions on business creation 
and growth. To address market fragmentation, new tools have been introduced as part of the RRP 
to improve coordination across public administrations, including an observatory of good regulation 
practices and the sectoral conference for improving the business environment. Measures in the RRP 
aim to foster an early payment culture in commercial transactions including mechanisms for better 
enforcement.  Spain  is  one  of  the  EU  countries  with  the  lowest  investment  in  R&D,  with  business 
R&D particularly low compared with the EU average (0.8% GDP vs 1.5% in the EU). Further steps to 
improve  the  efficiency  of  public  support  for  R&D  and  the  quality  of  innovation  output  would  be 
highly  beneficial,  as  well  as  the  strengthening  of  science-business  linkages.  Also,  major  gaps 
remain in the provision of the necessary skills to contribute to the green transition, information and 
(ICT)  specialists,  and  science,  technological,  engineering  and 
communications  technology 
mathematics  (STEM)  graduates.  These  challenges  are  particularly  acute  for  small  and  medium-
sized enterprises, which struggle to attract talent. 

9 

2. 

Assessment of macroeconomic vulnerabilities 

Conclusion 

In Spain vulnerabilities relate to high external and internal debt, both government and 
private, in a context of high unemployment, which continue to recede. These vulnerabilities 
have cross-border relevance. The Spanish economy weathered relatively well the negative shocks 
unleashed  by  Russia’s  aggression  against  Ukraine in  last  year,  chiefly  thanks to  its  limited  direct 
exposure to Russian energy  supplies. Private and external  debt ratios resumed their decline since 
the  aftermath  of  the  pandemic,  despite  remaining  at  elevated  levels.  The  current  account  has 
remained in surplus since 2012, primarily driven by the solid surpluses in the balance of trade, with 
important contribution from tourism activity. It has narrowed, however, in recent years, due to the 
negative  impact  of  the  pandemic  on  international  tourism,  and  higher  energy  prices.  The 
government debt to GDP ratio, driven by strong nominal GDP growth, decreased to 113.1% of GDP 
in 2022, which is still above 2019 levels. Going forward, over the forecast horizon, the stocks of 
internal  and  external  debt  are  expected  to  continue  declining  gradually  favoured  by  sustained 
economic expansion, despite the evolution of public debt in the longer term being subject to more 
uncertainty.  The  Spanish  financial  system  proved  to  be  resilient  in  face  of  the  recent  shocks 
induced  by  the  pandemic  and  the  energy  crisis.  However  high  inflation  and  the  necessary  rapid 
adjustment  in  monetary  policy  may  cause  some  challenges.  The  unemployment  rate  started  to 
decrease  again  in  2021,  but  it  remains  almost  double  the  EU  average.  Structural  pockets  of 
vulnerability remain, such as very high long-term and youth unemployment, and still a high share 
of  temporary  employees  in  the  public  sector.  Potential  risks  affecting  the  ongoing  consolidation 
process  and  unwinding  of  imbalances  relate  mainly  to  the impact  of  the prolonged  tightening  of 
financial conditions on households and firms’ financial positions, as well as on the medium to long-
term  sustainability  of  government  debt  in  face  of  the  current  market  conditions  and  population 
ageing. In addition, the resilience displayed last year by the labour market is expected to be tested 
under less favourable macroeconomic conditions. 

There  has  been  policy  progress  on  areas  affected  by  imbalances,  also  thanks  to  the 
implementation  of  reforms  and  investments  included  in  the  Spanish  RRP,  and  further 
policies  are  planned.  Thanks  to  its  cross-cutting  nature  and  scope,  the  RRP  can  continue  to 
significantly support the unwinding of Spain’s macroeconomic vulnerabilities, if properly and fully 
implemented. The measures implemented so far and those planned until end-2023 include actions 
improving  access  to  finance  for  SMEs  and  measures  intended  to  facilitate  preventive  debt 
restructuring  and insolvency  situations  for  companies.  The lower  projected  fiscal  deficit  projected 
for  the  next  few  years,  coupled  with  measures  aimed  at  improving  the  efficiency  of  both  the 
expenditure and revenue side are expected to contribute to accelerating the downward trajectory of 
public  debt,  but  fiscal  sustainability  risks  faced  by  Spain  in  the  medium  to  long  term  persist, 
according  to  the  Commission’s  fiscal  sustainability  assessment.  Strong  projected  current  account 
surpluses over the forecast horizon are set to steer a sustained reduction of the stock of external 
liabilities. The ongoing set of reforms related to the labour market are contributing to reduce the 
share  of  temporary  employees  and  boost  labour  productivity  in  the  medium-  to  long-term. 
Nonetheless,  low  innovation  capacity  and  shortcomings  of  business  regulation  continue  to 
adversely  affect  firms’  growth  and  productivity,  weighing  on  their  financial  position.  Further 
measures to boost the productivity and competitiveness of firms, and to address skills mismatches 
and shortages, would further support a deleveraging trend in the private, public and external sector. 

10 

Based on the findings in this in-depth review, the Communication “European Semester – 
2023  Spring  Package”   sets  out  the  Commission’s  assessment  as  to  the  existence  of 
imbalances or excessive imbalances in Spain, in line with Regulation 1176/2011. (9) 

2. 

Assessment of macroeconomic vulnerabilities 

(9)  European Commission (2023), European Semester Spring Package 2022, COM(2023) 600 final. 

11 

 
 
 
                                                 
Graph 2.2: Selected graphs, Spain 

2. 

Assessment of macroeconomic vulnerabilities 

Source: Ameco, Comext, Eurostat and European Commission services 

12 

020406080100120140050709111315171921% of GDPd) Fundamental-based and prudential benchmarks and NFC debt NFC debt, consolidated,  % of GDPFundamentals-based benchmark, % of GDPPrudential benchmark, % of GDP020406080100000204060810121416182022% of GDPe) Fundamental-based and prudential benchmarks and HH debtHousehold debt, %GDPFundamentals-based benchmark, household debtPrudential benchmark, household debt0510152025303599010305070911131517192123'% of GDPf) Gross fixed capital formationDwellingsNon-residentialMachineryTransportOtherTotalConstruction-130-80-302015Q416Q417Q418Q419Q420Q421Q422Q4% of GDPc) NIIP by sectorGeneral governmentPrivate sectorMFI (excl central bank)Central bank (incl reserves)Net int'l investment position (NIIP)0501001502002503000910111213141516171819202122% of GDPb) Decomposition of debt, consolidatedGovernmentHouseholdNon financial corporationsPrivate sector-7-23815161718192021222223*24*% of GDPa) Current accountGoods, fcastServices, fcastGoods excl energyEnergy balanceServices excl travelTravel balancePrimary inc. bal.Second. inc. bal.Current accountNet lending/borrowing        
 
 
 
2. 

Assessment of macroeconomic vulnerabilities 

Box 1: Inflation exposures and cross-border pass-through 

This  box  sheds  light  on  the  sources  of  inflation  in  Spain  and  its  spill-overs  with  EU 
partners.  The  period  since  2021  has  been  characterized  by  pandemic  aftershocks  and  global 
supply  chain  disruptions  compounding  global  inflationary  pressures  and  a  surge  in  commodity 
prices triggered by Russia’s war of aggression against Ukraine. As a result, inflation in Spain surged 
to unprecedented levels. In response, wages and profits also picked up across the EU, which further 
added  to price pressures in Spain. With input-output data, domestic inflation can be  decomposed 
into  the  contribution  from  key  cost  factors.  Taking  into  account  some  data  limitations,  the 
framework can be used to attribute consumer and investment price changes to i) extra-EU import 
price changes, which include both directly imported inflation and inflation passed through from EU 
partners  import  costs  ii)  domestic  unit  labour  cost  changes  iii)  domestic  unit  profit  changes, 
including indirect taxation changes and iv) rest-of-EU value added price changes. (10) 

Data  suggests  that  much  of  Spanish  inflation  in  2022  reflected  surging  import  prices, 
while domestic sources are projected to dominate over the forecast horizon. In 2022, as 
shown in Graph 2.3, energy imports were key drivers of consumption and investment inflation. The 
direct  impact  of  non-energy  imports  from  outside  the  EU  was  also  significant,  particularly  for 
investment inflation. Spill-overs from other EU countries remained limited, however. Namely, import 
cost  pass-through  from  EU  partners  increased  domestic  inflation  somewhat,  whereas  the  value 
added inflation in other EU countries had a negligible impact on Spanish inflation. A relatively small 
part of consumer and investment inflation can be explained by the domestic value-added deflator 
which covers wages and profits. This mainly reflects unit profits, whereas wages contributed little 
as  unit  labour  cost  stagnated  in  2022.  The  impact  of  energy  inflation  is  set  to  subside  and  to 
eventually dampen inflation over the forecast horizon, as prices of energy commodities have fallen. 
Similarly, the impulse from non-energy import prices is expected to fade. However, the contribution 
from  both  unit  profits  and  unit  labour  costs  is  expected  to  increase  in  both  2023  and  2024 
compared to 2022. Spill-overs from inflation in other EU countries is set to remain marginal. 

The impact of Spanish wages and profits on other Members States remains limited, as 
domestic factors contributed only little to Spanish inflation. Although Spanish value added 
has a non-negligible impact on the domestic demand of other Member States, Spanish value-added 
inflation  remains  contained  vis-à-vis  the  significant  impact  from  import  prices  (see  Graph  2.4). 
Overall, Spanish value added inflation has contributed little to consumer inflation in the rest of the 
EU so far. Most exposed countries to Spanish inflation are Portugal and Luxembourg with inflation 
spill-overs at around 0.3 pps. p.a. over the forecast horizon. 

(10)  The graphs below are based on national accounts data and the Commission’s Spring 2023 forecast, which are combined 
through a ‘Ghosh’ matrix based on Eurostat’s Figaro input-output available for 2015-2020. HICP is taken as the measure of 
the price of private consumption, including non-residents. Energy import prices from extra-EU reflect realised median prices 
until  2022,  and  energy  price  assumptions  underlying  the  Spring  forecast  thereafter.  Other  goods  prices  reflect  median 
Eureopan  prices  per  industry  until  2022,  and  forecast  non-energy  goods  and  service  trade  prices  for  2023-2024.  Value 
added  deflators are assumed to  affect  all industries within a country to the same degree. Changes  in import prices and 
value  added  deflators  are  assumed  to  affect  demand  prices  with  a  delay  of  4  and  5  months  for  consumption  and 
investment  inflation,  respectively.  For  a  similar  analysis  using  an  input-output-based  methodology,  see  “Inflation 
Differentials  in  Europe  and  Implications  for  Competitiveness:  Thematic  Note  to  Support  In-Depth  Reviews”  European 
Commission 2023, Institutional paper 198. 

13 

 
                                                 
Graph 2.3: Components of gross fixed capital formation deflator growth and consumer price 
inflation 

2. 

Assessment of macroeconomic vulnerabilities 

Source: European Commission services 

Graph 2.4: Impact of Spanish value added inflation on EU partners’ consumer price inflation 

Source: European Commission services 

14 

-202468161718192021222324% change (year-on-year)ES: contribution to domestic GFCF deflator growth-4-20246810161718192021222324% change (year-on-year)ES: contribution to domestic CPI deflator growthDomestic ULCUnit profits (&taxes)RoEU value added deflatorEnergy imports from Extra-EUOther imports from Extra-EURoEU import cost passthr.ResidualDeflator growth YoY00.10.20.30.40.50.60.719-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-2419-2222-24 .PTLUCYMTFRGRITSIHRATBELVLTBGNLFIROCZSKEEHUSEPLIEDEDKRoEApp contribution to average annual change of CPIES contribution to average annual change of CPI in other MSPassthrough of ES unit labour costPassthrough of ES unit profits (& ind. taxes)Passthrough from ES energy import costPassthrough from other ES G&S imports 
  
   
 
2. 

Assessment of macroeconomic vulnerabilities 

Table 2.1: Selected economic and financial indicators (Part 1), Spain 

(e) estimate based on ECB quarterly data 
(1) Potential output is the highest level of production that an economy can reach without generating inflationary 
pressures. The methodology to compute the potential output is based on K. Havik, K. Mc Morrow, F. Orlandi, C. Planas, R. 
Raciborski, W. Roeger, A. Rossi, A. Thum-Thysen, V. Vandermeulen, The Production Function Methodology for Calculating 
Potential Growth Rates & Output Gaps, COM, European Economy, Economic Papers 535, November 2014. 
(2) Deviation of actual output from potential output as % of potential GDP. 
(3) Current accounts in line with fundamentals ("current account norms") are derived from reduced-form regressions 
capturing the main determinants of the saving-investment balance, including fundamental determinants, policy factors 
and global financial conditions. See L. Coutinho et al. (2018), "Methodologies for the assessment of current account 
benchmarks", European Economy, Discussion Paper 86/2018, for details.  
(4) This benchmark is defined as the average current account required to halve the gap between the NIIP and the 
indicative MIP benchmark of -35% of GDP over the next ten years, or to stabilise the NIIP at the current level if it is 
already above the indicative MIP benchmark. Calculations make use of Commission’s T+10 projections. 
(5) NENDI is a subset of the NIIP that abstracts from its pure equity-related components, i.e. foreign direct investment 
(FDI) equity and equity shares, and from intracompany cross-border FDI debt, and represents the NIIP excluding 
instruments that cannot be subject to default. 
(6) Fundamentals-based benchmarks are derived from regressions capturing the main determinants of credit growth and 
taking into account a given initial stock of debt. Prudential thresholds represent the debt threshold beyond which the 
probability of a banking crisis is relatively high, minimising the probability of missed crisis and that of false alerts. 
Methodology to compute the fundamentals-based and the prudential benchmarks based on Bricongne, J. C., Coutinho, L., 
Turrini, A., Zeugner, S. (2019), “Is Private Debt Excessive?”, Open Economies Review, 1- 42. 
Source: Eurostat and ECB as of 2023-04-28, where available; European Commission for forecast figures (Spring forecast 
2023) 

15 

all variables y-o-y % change, unless otherwise stated2003-072008-122013-18201920202021202220232024Real GDP 3.5-1.32.02.0-11.35.55.51.92.0Potential growth  (1)3.61.20.30.90.10.61.11.21.5Contribution to GDP growth:Domestic demand 4.7-3.01.61.9-8.34.23.31.32.3Inventories 0.0-0.20.2-0.2-0.81.0-0.20.00.0Net exports -1.21.80.20.4-2.20.32.40.6-0.3Contribution to potential GDP growth (1):Total Labour (hours) 1.70.1-0.10.30.00.30.60.70.9Capital accumulation 1.70.70.30.50.30.30.30.40.4Total factor productivity 0.20.40.20.1-0.10.00.20.20.2Output gap (2)3.4-4.3-4.31.9-9.8-5.4-1.3-0.6-0.2Unemployment rate9.719.120.814.115.514.812.912.712.4Harmonised index of consumer prices (HICP)3.22.30.70.8-0.33.08.34.02.7GDP deflator 3.90.50.61.41.22.34.34.42.9External positionCurrent account balance (% of GDP), balance of payments-7.0-3.92.32.10.61.00.61.61.5Trade balance (% of GDP), balance of payments-4.4-0.93.42.91.51.51.4..Primary income balance (% of GDP)-1.5-1.7-0.10.20.20.50.3..Secondary income balance (% of GDP)-1.1-1.3-1.0-1.0-1.1-1.1-1.1..Current account explained by fundamentals (CA norm, % of GDP) (3)-2.1-1.00.30.80.80.60.80.90.9Required current account to stabilise NIIP above -35% of GDP over 20Y (% of GDP) (4)-0.31.4-0.6-0.9-1.5-1.3-1.1-1.0-0.9Capital account balance (% of GDP)0.60.40.40.30.50.90.9..Net international investment position (% of GDP)-66.5-91.3-87.9-73.7-85.7-71.5-60.5..NENDI - NIIP excluding non-defaultable instruments (% of GDP) (5)-35.6-71.8-62.6-46.1-52.1-39.5-30.8..Net FDI flows (% of GDP)3.30.10.60.61.6-1.40.4..CompetitivenessUnit labour costs (ULC, whole economy)3.10.4-0.63.78.6-0.30.63.83.1Nominal compensation per employee 2.92.00.63.00.52.73.24.94.0Labour productivity (real, hours worked)0.51.70.60.60.0-1.61.30.50.0Real effective exchange rate (ULC)1.8-1.6-2.01.92.80.1-3.2-1.5-0.5Real effective exchange rate (HICP)2.2-0.10.3-1.50.10.7-1.3..Export performance vs. advanced countries (% change over 5 years)7.7-4.20.00.6-6.6-6.4...Private sector debtPrivate sector debt, consolidated (% of GDP)158.6198.3153.5129.3148.1139.1124.9..Household debt, consolidated (% of GDP)70.183.267.356.862.758.453.3..Household  debt, fundamental benchmark (% of GDP) (6)15.616.125.834.138.740.241.9..Household  debt, prudential threshold (% of GDP) (6)43.442.947.949.144.441.439.5..Non-financial corporate debt, consolidated (% of GDP)88.5115.186.372.585.480.871.6..Corporate debt, fundamental benchmark (% of GDP) (6)35.133.033.236.640.942.644.4..Corporate debt, prudential threshold (% of GDP) (6)62.561.459.562.260.257.455.9..Private credit flow, consolidated (% of GDP) 25.3-0.7-3.21.54.72.50.0e..Corporations, net lending (+) or net borrowing (-) (% of GDP)-3.46.16.54.02.84.06.47.06.6Households, net lending (+) or net borrowing (-) (% of GDP)-3.9-0.21.01.58.44.8-0.1-0.4-0.9Net savings rate of households (% of net disposable income)3.94.62.64.113.79.6...forecast 
 
        
 
 
 
Table 2.2: Selected economic and financial indicators (Part 2), Spain 

2. 

Assessment of macroeconomic vulnerabilities 

(7) Unweighted average of price-to-income, price-to-rent and model valuation gaps. The model valuation gap is 
estimated in a cointegration framework using a system of five fundamental variables; total population, real housing 
stock, real disposable income per capita, real long-term interest rate and price deflator of final consumption expenditure, 
based on Philiponnet, N., Turrini, A. (2017), "Assessing House Price Developments in the EU," European Economy - 
Discussion Papers 2015 - 048, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission. 
Price-to-income and price-to-rent gaps are measured as the deviation to the long term average (from 1995 to the latest 
available year). 
(8) Price-to-income overvaluation gap measured as the deviation to the long term average (from 1995 to the latest 
available year). 
(9) Domestic banking groups and stand-alone banks, EU and non-EU foreign-controlled subsidiaries and EU and non-EU 
foreign-controlled branches. 
Source: Eurostat and ECB as of 2023-04-28, where available; European Commission for forecast figures (Spring forecast 
2023) 

16 

all variables y-o-y % change, unless otherwise stated2003-072008-122013-18201920202021202220232024Housing marketHouse price index, nominal14.2-6.61.95.22.23.77.4..House price index, deflated10.4-8.21.24.12.21.50.6..Overvaluation gap (%) (7)20.215.1-6.94.96.98.913.5..Price-to-income overvaluation gap  (%) (8)18.518.0-6.01.05.86.410.8..Residential investment (% of GDP)11.16.94.55.85.95.45.5..Government debtGeneral government balance (% of GDP)1.0-9.3-4.8-3.1-10.1-6.9-4.8-4.1-3.3General government gross debt (% of GDP)42.162.7102.398.2120.4118.3113.2110.6109.1Banking sectorReturn on equity (%).1.16.56.8-3.610.5...Common Equity Tier 1 ratio.9.412.613.814.715.0...Gross non-performing debt (% of total debt instruments and total loans and advances) (9).4.45.32.72.52.6...Gross non-performing loans (% of gross loans) (9)..5.63.12.82.92.6..Cost of borrowing for corporations (%)4.13.62.31.51.51.33.3..Cost of borrowing for households for house purchase (%)4.03.42.21.71.51.42.9..forecast 
        
 
 
 
Table 2.3: Selected housing market indicators (Part 3), Spain 

2. 

Assessment of macroeconomic vulnerabilities 

(') Forecast. The forecast of house prices is computed on the basis a housing valuation model shared with Member States 
in the context of the EPC LIME working group. The forecasts represent real house price percentage changes expected 
based on economic fundamentals (population, disposable income forecast, housing stock, long-term interest rate, and the 
price deflator of private final consumption expenditure), as well as the error correction term summarising the adjustment 
of prices towards their long-run relation with fundamentals. The source for the forecast of other variables is Ameco. 
(1) Price to income in level is the number of years of income necessary to buy an assumed 100m2 dwelling. See 
Bricongne, J-C, A Turrini, and P Pontuch, 2019, “Assessing House Prices: Insights from HouseLev, a Dataset of Price Level 
Estimates”, Discussion Paper 101, European Commission, available in "https://ec.europa.eu/info/publications/assessing-
house-prices-insights-houselev-dataset-price-level-estimates_en".  
(2) Price to income and price to rent gaps are measured in deviation to the long term average (from 1995 to the latest 
available year).  
(3) The model valuation gap is estimated in a cointegration framework with nominal house prices as the dependent 
variable and five fundamental explanatory variables: total population, real housing stock, real disposable income per 
capita, real long-term interest rate and price deflator of final consumption expenditure. See Philiponnet and Turrini, 
Assessing House Price Developments in the EU (2017) available in "https://ec.europa.eu/info/publications/economy-
finance/assessing-house-price-developments-eu_en" and revision notes presented to LIME in October 2019 and June 
2020.  
(4) The average house price gap is the simple average of the price-to-income, price-to-rent and model valuation gaps. 
Sources: Eurostat, OECD, ECB, BIS, Ameco, national sources, European Commission calculations. 

17 

2003-072008-122013-18201920202021202222Q122Q222Q322Q4House price developmentsUnitSourceReal house price, yoy growth%(a)10.5-8.11.44.12.21.50.62.10.7-0.50.0Nominal house price, yoy growth%(a)14.2-6.42.15.22.23.77.48.58.17.65.5Price to income in level (1)years(b)11.911.99.510.210.710.711.112.110.112.410.3Rent price developmentsSourceNominal rent price index2015=100(a)84.299.5100.8103.2104.3105.0106.4107.1107.3107.5107.7Nominal rent price, yoy growth%(a)4.32.2-0.11.51.10.61.34.95.35.76.0Valuation gapsPrice to income gap (2)%(c)18.518.0-6.01.05.86.410.87.910.512.412.3Price to rent gap (2)%(c)23.213.9-9.65.46.59.816.413.216.018.118.1Model valuation gap (3)%(c)19.113.4-4.98.48.410.413.511.313.314.814.5Average house price gap (4)%(c)20.215.1-6.94.96.98.913.510.813.215.115.0Housing creditBank mortgages (% GDP)%(d)46.961.050.441.045.142.338.3Bank mortgages, yoy growth%(d)22.80.3-3.3-1.5-1.31.2-0.2Housing supply0.00.00.00.0Residential construction - dwellings  (% GDP)%(e)11.16.94.55.85.95.45.5Residential construction - dwellings, yoy growth%(e)36.3-11.85.75.2-11.4-4.83.1Non-residential construction (% GDP)%(e)8.56.84.54.64.64.54.9Value added in the construction sector, yoy growth%(e)14.3-9.50.34.3-13.2-3.04.1Building permits index2015=100(a)1656.5345.7141.4236.4137.0195.6326.3289.7343.6306.6365.2Building permits, yoy growth%(a)10.3-36.012.10.7-42.042.866.885.090.051.650.4Number of transactions, yoy change%(f)-3.2-13.88.9Other housing market indicatorsShare of owner-occupiers, with mortgage or loan%(a)32.032.830.928.430.330.730.5 
          
 
 
 
Table 2.4: Selected household debt indicators (Part 4), Spain 

2. 

Assessment of macroeconomic vulnerabilities 

(f) European Commission forecast, (1) Gross non-performing bank loans and advances to Households and non profit 
institutions serving households (% of total gross bank loans and advances to Households and non profit institutions 
serving households). (2) Quarterly data is annualized. 
Source: (a) Eurostat, (b) Ameco, (c) European Commission calculations, (d) ECB. 

18 

2003-072008-122013-20202120222023f|22Q122Q222Q322Q4SourceStocksDebt, consolidated (% of GDP)(a,d)708365585351|57565453Debt, consolidated (% of potential GDP)(a,b,d)738062555351|54555352Prudential threshold (% of GDP)(c)434348413935|Fundamental benchmark (% of GDP)(c)161628404244|Debt (% of gross disposable income)(a,b,d)111130103898685|88898786Interest paid (% of gross disposable income) (2)(a,b)3.13.41.00.3|0.30.50.61.8Debt (% of gross financial assets)(a,d)40.749.331.926.1|26.126.526.725.8Share of variable rate loans for house purchase (%)(d)88.685.649.425.923.7|Domestic  loans in forex (% of adjusted dom. loans)(d)0.21.10.60.30.2|Adjusted domestic  loans (% of gross disposable income)(d)110.1128.8101.988.585.1|Loans for house purchase (% of gross disposable income)(d)74.495.376.464.662.3|FlowsCredit flows (% of gross disposable income) (2)(a)16.9-0.6-2.00.90.21.4|0.27.1-4.6-1.3Loans for house purchase (% gross disposable income)(a,b)13.40.2-2.20.6-0.1|Benchmark for flows (% of GDP)(c)0.91.53.81.71.30.6|Savings rate (% gross disposable income)(b)8.39.08.213.87.27.0|Investment rate (% gross disposable income)(b)15.39.95.16.87.47.3|p.m. Bank HH NPLs (% of HH loans)(1)(d)4.33.8|