Publication

This paper discusses Spain's unprecedented surge in exports after a year of anaemic growth in 2011. Export growth, much more than the decline in imports, has reduced the trade deficit and prevented the country’s recession from being deeper, argues the author. Whereas in the past, when Spain could boost its competitiveness by devaluing the currency, as a euro member it can only do so through productivity gains and improving the price/quality relationship. Exporters have so far been remarkably successful, the author asserts. He concludes that the challenge is to maintain the momentum when the economy starts to grow again.