Spanish exports now account for 39% of GDP and these are the sectors that are growing

Tuesday, 17 September 2024, 12:50

| Updated 13:26h.

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Spanish exports are gaining ground in the overall economy. Between 2008 and 2023 the market has grown by almost 50% in real terms and their proportion of gross domestic product (GDP) has increased by 13 percentage points from 26% to 39%. This upward swing in exports as part of GDP has been much higher than in some of the other sizeable economies in the eurozone. As a result, for 2023 the percentage held by exports in GDP was greater in Spain than in Italy or France. Moreover, Spain has halved the gap with Germany, often seen as the engine of the European economy and the EU’s largest exporter. In 2023 Spain was only nine percentage points away from what exports contribute to Germany’s GDP, that is, 48%.

This extraordinary growth in exports has been across the board – by product as well as by destination. However, a study published by the Bank of Spain warns that the growing fragmentation of international trade flows could pose a risk to the future progression of Spanish exports.

The reasons for this export success in the Spanish economy are twofold: improved competitiveness and a greater orientation of Spanish companies towards international markets. This is demonstrated by the sustained increase in the number of Spanish companies that export on a regular basis.

Goods and services

Spain’s export strength over the last fifteen years has been widespread by product and has been noted to cover both goods and services. In 2023 goods exports accounted for 68% of foreign sales, making up 26.4% of GDP, nine percentage points more than in 2008. The sectors that have led the growth are semi-manufactured goods (for example, chemicals and metal products), the food sector; capital goods (mainly transport equipment) and the automotive sector.

Exports of services have grown even more. Between 2008 and 2023 they have increased by 66% and their contribution to GDP has risen from 8.2% to 12.5%. This jump is due to the strong increase in exports of both tourism and non-tourism services. The recovery of tourism revenues after the pandemic (up to 4.9% of GDP in 2023) has consolidated Spain’s position as the world’s second largest tourist destination in terms of arrivals and spending by overseas visitors. Exports of non-tourism services accounted for 7.6% of GDP in 2023.

Geographical diversification

Moreover, Spain is increasingly diversifying the countries where it sells. In 2008 the country’s merchandise exports were highly concentrated in the eurozone, especially in France, Germany and Italy. In 2023 the eurozone is still the main destination for Spanish sales of goods abroad, standing at 55% of the total, but Spain now exports relatively more to countries such as Morocco, the USA, China and Turkey. Together, these countries received 12.1% of our exports of goods in 2023, almost four percentage points more than in 2008.

This greater geographical diversification of Spanish exports can also be seen in the case of services. Thus, for example, the weight of exports of tourism services to North and South America has increased, especially post-pandemic.

Risks

Nevertheless, there are a number of risks to keep in mind. The current geopolitical framework is characterised by high uncertainty, rising tariffs and increasing trade fragmentation. All this could negatively affect the further growth of Spanish exports in the coming years.

Furthermore, the Banco de España’s study also indicates that labour costs per unit of output have increased more in Spain than in the rest of the European Union since the outbreak of the pandemic. A persistent deterioration in this indicator of competitiveness could lead to a loss of strength in Spanish exports, tipping the scales the other way.

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