Malaga will once again lead the Andalusian economy this year with growth of 2.2%

Within the slowdown in growth predicted by experts for this year, Malaga is projected to lead the advance of the Andalusian economy again this year with an increase in gross domestic product (GDP) of 2.2%. This increase, although modest compared to the 7.7% achieved by the province in 2022, is high compared to the regional average forecast for this year, which is 1.3%.

Malaga will be the province with the highest growth rate in the entire region, standing almost one per cent above the average and two tenths of a percentage point ahead of the second best positioned province, Seville (2%). Next, in descending order, will be Cadiz (1.3%), Granada (0.8%), Almeria (0.6%), Huelva (0.5%), Cordoba (0.3%) and Jaén (0.1%). This is revealed in the latest report Economic Forecasts for Andalucía, prepared by Analistas Económicos de Andalucía and published by Unicaja Banco.

The study confirms the "slowdown in activity on a global scale with respect to the previous year and the persistence of inflationary tensions", although it recognises that in recent months there has been an improvement in the outlook, which has led the main international economic organisations to revise their projections. For example, the OECD forecasts that in 2023 the world economy will register growth of 2.6%. With regard to inflation, it warns that despite the moderation in energy prices, the dynamics followed by prices suggest that underlying inflation will remain high.

In the case of the Spanish economy, in 2022 as a whole it grew more than expected, at a rate of 5.5% and with a good performance for the labour market. The latest available data, relating to the first quarter of 2023, show a quarter-on-quarter change in GDP of 0.5%, with the external sector acting as a support. In year-on-year terms, GDP rose by 3.8%, with exports performing well, especially tourism services, and the contribution of the construction and services sectors on the supply side.

The latest projections published by the Bank of Spain point to an increase in national GDP of 1.6% for 2023, while growth of over 2% is estimated for 2024.

As for Andalucía, in 2022 it recorded GDP growth of 5.2%, which is 0.4 percentage points less than that of 2021; Malaga (7.7%), Cadiz (6.3%) and Almeria (5.6%) were above the regional average.

In the first quarter of this year, Andalusian GDP grew by 0.7% compared to the previous quarter, above the national average (0.5%), due to the positive contribution of domestic demand, with an increase in household spending of 1.3%, which in the last quarter of 2022 recorded a fall of 0.2%. In year-on-year terms, growth was 3.6% (3.8% in Spain), allowing GDP to return to pre-pandemic levels. Job creation showed remarkable dynamism, with the number of social security contributors growing by 3% in April.

Over the year as a whole, Andalucía's GDP is expected to grow by 1.3%, in line with Spain (1.4%). The number of employed persons is forecast to increase by an average of 0.8%, based on the good performance of the industrial and services sectors. The number of unemployed is expected to fall by 3.4%, bringing the unemployment rate to 18.4% on average for the year.

For 2024, the first estimates of Analistas Económicos de Andalucía place the growth rate of the Andalusian economy at 2.1%, which will translate into an increase in employment of 1.3%. The unemployment rate is forecast to fall by 0.8 points and will stand at 17.6% on average for 2023.

The research institution said the forecasts are "subject to high uncertainty and sources of risk", which may orient them downwards in terms of economic activity and upwards with respect to inflation. Among the main risks are the geopolitical tensions of the war in Ukraine, the tightening of financial conditions beyond expectations and the persistence of the dynamics of rising prices.