29. 03. 2021 the spanish economy and the covid - 19 crisis : assessment, outlook and challenges europa press informative breakfast pablo hernandez de cos governor * english translation of the original speech in spanish good morning, ladies and gentlemen. i would like to thank the organisers of this event for their kind invitation. i shall begin with a brief assessment of the period since the covid - 19 crisis broke. i shall then set out the banco de espana ’ s view on the outlook for the spanish economy. finally, i shall describe the medium - term economic policy challenges at the national and european level. taking stock of a year of pandemic : an unprecedented, persistent and uneven impact covid - 19 has caused a global economic recession of an intensity which, in most geographical areas, is unprecedented. the crisis is, moreover, proving very persistent : as of today the pre - pandemic levels of activity have not yet resumed in most countries. indeed, the successive waves of the pandemic have checked the recovery, particularly in the sectors most exposed to the restrictions. in spain, this impact is particularly marked. gdp declined by 10. 8 % in 2020 as a whole, a slump appreciably greater than that in the euro area ( - 6. 8 % ). at end - 2020, spanish gdp was still 8. 9 % below its pre - pandemic level, while this gap was 4. 9 percentage points ( pp ) in the euro area. several reasons account for this more pronounced impact in our country. one was the greater intensity of the pandemic initially, which led to harsher containment measures in spring last year. another was the greater weight of the sectors most affected by these measures. but the impact is also the outcome of the smaller size, on average, of our firms. smes are less adaptable to this shock, given that they usually face greater obstacles in gaining access to external financing ; their fixed costs are, in proportion to their turnover, higher ; and their levels of digitalisation are generally lower, which hampers their access to remote working. the first two editions of the banco de espana ’ s survey on business activity confirm these circumstances. the impact of the crisis has been very uneven, as the sectoral outlook evidences. thus, while effective social security registrations1 were, in february, 6. 8 % down on their prepandemic level, the figures were significantly worse in the sectors whose activity has most

miguel fernandez ordonez : the spanish economy after the crisis opening address by mr miguel fernandez ordonez, governor of the bank of spain, at the “ iv conference on the unique features of spanish savings banks ” / federacion de usuarios de las cajas de ahorros ( federation of savings banks customers ), zaragoza, 11 february 2009. * * * thank you mr chairman, the profound worldwide economic slowdown, which in the industrialised countries has already turned into a rapid and sharp recession, is undoubtedly the most serious since the 1929 great depression. in recent months, the collapse of international financial markets has been averted only with great difficulty and we don ’ t yet know what the final consequences of the events unfolding will be for the real economy. faced with this situation, all efforts will inevitably focus on attempting to exit the crisis. internationally, and within spain, hitherto inconceivable measures have been adopted, such as unlimited liquidity injections by central banks, extensive fiscal stimuli and exceptional support to the financial system. naturally enough, governments, politicians, central bankers, supervisors and academics are all contributing to these tasks. and it is not surprising, therefore, that all my speeches in recent months have been to analyse the causes of the global crisis and to review the various measures to tackle it. however, on receiving your much appreciated invitation, i thought i ’ d take advantage of the sense of calm reflection which university fora instil to pause and ponder on what may happen to the spanish economy after the crisis, when the global economy recovers. it is worth reflecting on the aftermath because the global nature of the crisis is " homogenising " the different economies. and by blurring the differences from one economy to another, it is hard to discern the different tasks awaiting them. as the crisis left nobody unscathed, not even those countries which acted prudently, i. e. those that did not incur excessive debt or whose competitiveness did not worsen, are faring better than those which were not so virtuous. but when the crisis ends, differences will re - emerge. when a plane taking off from new york almost crashed last month, the health and well - being of all the passengers hinged on how the crisis was resolved, without this depending on their youth, cholesterol levels, excess weight or the state of their lungs. the drama was the same for everybody. luckily,