Palma.Spanish high street bank BBVA predicted yesterday that although the gross Balearic product (PIB) will drop by -0.4% this year, there will be what a spokesman described as a hesitant recovery of 1% in 2013.
Rafael Domenech, Head of Economic Research at BBVA said it would seem that the economic crisis isn't going to get much worse in the Balearics but rather that the economy has stagnated for a period of time. Domenech said that it appears the crisis has bottomed out but it is too soon as yet for any certain forecast. He suggested that the Balearic economy will be faring better than Spain as a whole given that the national PIB will be down -1.3% this year with only a slight growth of 0.6% predicted for 2013.
Domenech said that the Balearics is one of the regions with the highest level of government debt to be measured against gross regional product, due to the Islands' failure to bring down its deficit sufficiently during the 2011-2012 financial year. He said that more human resources needs to be invested in the tourist sector to help bring the region back into economic growth.
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