Brussels Praises Positive Impact of Spain’s Reforms

According to a report published by the European Commission, out of all the worst-affected countries hit by the economic crisis, Spain is the one whose structural reforms, implemented to bring the country back to recovery and growth, have had the most positive impact.

The report says that Spain is followed by Portugal, while Italy and Greece languish some way behind.

The study, which was carried out by the Commission’s Economic Activity Department, has examined the economic impact of each country’s reforms that were put in place to get themselves out of the crisis.

According to Brussels, Spain’s efforts to reduce not only the cost of setting up a new business, but also the complexity of one, has been particularly successful. The number of new small businesses has increased by 2.3% between 2010 and 2013.

There has been a significant rise in the number of foreign companies setting up in Spain, particularly within the scientific and the professional services sectors, which is pretty outstanding when the country was struggling with recession.

Many companies now are also able to export their products due to lower costs, something which was not economically viable before.

Bankruptcy procedures have also been shortened, which the Commission says, is advantageous to both banks and businesses.

By deregulating the services sector following an EU directive, Spain’s productivity increased by 5.7% up to the middle of 2013, compared with 4.3% in Portugal.

Online businesses have also been a major focus for promoting growth, and in the long term, the digital market is expected to be responsible for 1% of the country’s GDP.

While Spain has been commended by the European Commission in many aspects, it has also been criticised in others. Some of the reforms are still in their initial stages while others have been fully implemented.

The report says that the deregulating of the professional services sector should have led to a restructuring of the legal system which could make the system 2% more efficient and productive. As yet, few changes have been made to the judicial system.

And, some public administrations are still struggling with debt, which has a negative impact on small and medium businesses in the area, particularly if they are owed money.

Nevertheless, the Commission is certain that with more time positive results will be seen in all sectors and further growth is to be expected.

Despite the commendable results, Brussels warns that there is no margin for complacency and that each country should forge ahead with their plans to bring their country back to economic growth.

Source: www.elmundo.es