Spain | Recovery, Transformation and Resilience Plan: making virtue of necessity

The Recovery Plan failed to fullfil expectations in 2021. As we look forward, we must focus on streamlining and accelerating its roll-out and on using it to transform our economy and invest wisely in projects with strong potential to increase employment and improve job quality and productivity.

Key points

• Key points:
• Despite strong expectations at the end of 2020, the implementation of the Recovery, Transformation and Resilience Plan (RTRP) throughout 2021 took longer than expected and its impact on the national accounts was lackluster.
• According to information contained in the 2nd Progress Report on the Recovery Plan released in April of this year, committed expenditure came to approximately 21 billion in 2021 and some 4.5 billion in the first quarter of 2022.
• BBVA Research expects execution in national accounting terms to reach 15 billion in 2022, before picking up to 20 million in 2023 and 2024. These forecasts point to a delay of at least one year with respect to the timeline expected at the end of 2020 and a flattening of the implementation process for European funds.
• The risk over the coming quarters is that this process will encounter bottlenecks, delays in supplies and components, or a shortage of qualified labour, thus increasing inflationary pressures and pushing up demand for imports.
• There is also further uncertainty regarding the effects of EU funding and of the structural reforms to be undertaken with such funding on potential GDP growth and the structural unemployment rate.

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