The Balearic economy loses momentum

This slowdown means that the wealth generated on the islands has last summer remained 7.4% lower than before the pandemic, and the business organization predicts that it will not be until the end of 2023 or 2024 that the islands will recover to pre-pandemic levels.

Carmen Planas indicated that this slowdown is likely to be more pronounced during 2023 due to high inflation and the war in Ukraine however, she did not hide the fact that, despite this, expectations are good. The president of CAEB provided this latest economic report during the celebration of the traditional Christmas drinks with the media.

Regarding the evolution of the economy of the islands, it was recalled that during the third quarter of last year it was growing at a rate of 14.7%, almost four points above the summer of this year.

In the fourth quarter of 2021 that increase was 13.5%, standing at 13.9% in the first quarter of 2022 and 14.1% in the second, reflecting the extent of the slowdown on reaching the third.

In this regard, it was recalled that the islands are operating in a national and international context in which growth forecasts are being adjusted downwards.

By sectors, during the summer it was the services sector (the one most closely linked to tourism) that showed the greatest momentum, with a rise of 11.8%, although a year ago it reached 16.3%. Construction recorded an increase of 5.4% and industry 6.5%.

Economy: consumption loses strength

A very relevant aspect is the loss of strength of consumption, which during the third quarter of this year rose by 9.8% when the previous summer it rose by 15%.

Business investment is more stable, which closed the summer with a rise of 7.3%, an identical rate to the same dates in 2021.

By islands, growth on Mallorca was 10.5%, on Ibiza and Formentera 13.2%, and on Menorca 11%.

For the full article, please visit Diario de Ibiza website here.