SPAIN'S government has predicted unemployment will drop to 16.6% this year, and plans to offer nearly 8,000 new public-sector jobs nationwide.
Regional governments, of which Spain has 17 plus those of the two city-provinces of Ceuta and Melilla on the northern Moroccan coast, will be allowed to spend a total of €5.4 billion extra this year in healthcare, education, social services and transport – an increase on the original €4bn proposed by treasury minister Cristóbal Montoro.
Centre-right party Ciudadanos has agreed to vote in favour of the 2017 budget following a series of measures to 'modernise' the national economy and increase social welfare spending, but it appears that the new 'environmental tax' and taxes on sugary soft drinks will not be applied after all – at least, not this year.
The 'green' tax is under debate, and the drink tax is undergoing a feasibility study, but as yet no draft plan has been drawn up for it.
In order to increase the emphasis on social welfare and strengthening employment, this year's budget will include a rise in spending on student grants, scholarships and education in general of 1.7%; a further 4.1% on company research and development; 5.5% extra on employment and 7.6% more on the justice system.
A total of €100 million will be put aside for elderly and disabled care benefits, the same amount on increasing the fight against tax fraud, and €342 million on family protection and the battle against childhood poverty.
As well as another 67,000 civil servant jobs due to be offered, around a quarter of a million temporary public-sector workers will be given permanent positions.
Unemployment at the end of 2016 stood at 18.63%, and economy minister Luis de Guindos believed this would fall to 17.5% over 2017, ending the year on 16.6%, but with the predicted GDP growth for the year remaining at 2.5%.
De Guindos calls these forecasts 'prudent', and expects the last quarter of 2017 to see 19 million of Spain's 46 million inhabitants in work, with unemployment down by 458,000.
Consumer spending will increase the GDP by 2.1% - down from an initial 2.4% - but exports will result in a rise of 0.4% on the GDP as opposed to the original 0.1% forecast.
For a second consecutive year, Spain is expected to see an increase in demand from importers abroad – something that has not happened since 1997 – and for the fifth year running, 2017 will see a positive trade balance, expected by be in region of 1.9%.
Inflation, measured in accordance with the consumer prices index (IPC), is forecast to grow by 1.5% in 2017, the same as it did in 2016.
