Discusses key economic indicators and trade statistics, which countries are dominant in the market, and other issues that affect trade.
2021 proved to be challenging in Spain due to many external factors. While the effects of the COVID-19 pandemic are still being felt in 2022, additional constraints such as those brought on by the launch of the war in Ukraine by Russian forces early in the year, the ongoing global supply chain disruption, and unusually high inflation rates, mostly due to rising energy rates, are compounding uncertainty in the marketplace which, in turn, is affecting Spain’s economy and traditional trade patterns.
Nevertheless, the United States continues to enjoy close bilateral relations with Spain, and Spanish importers are receptive to trade opportunities from U.S. exporters. With a GDP of USD 1.4 trillion and a population of 47.3 million people, Spain is the fourth-largest economy in the Eurozone. The Spanish economy increased 5.1 percent in 2021 (after a decline of almost 11 percent in 2020). The IMF forecasts that Spain’s recovery rate in 2022 is estimated to grow 4.8 percent, and then taper off to a recovery of 3.3 percent in 2023.
Spain traditionally represents a significant export market for the United States. According to the U.S. Department of Commerce, in 2021, U.S. exports of goods and services to Spain were USD 21.9 billion, up 20.6 percent from 2020. Of that, U.S. exports of goods to Spain in 2021 amounted to USD 16.3 billion, up from USD 12.9 billion in 2020 and higher also from pre-COVID year 2019 (USD 15.3 billion). Services exports from the United States to Spain increased from USD 5 billion in 2020 to USD 5.6 billion in 2021. Actual U.S. exports to Spain are substantially higher than the reported numbers, since many of Spain’s imports from the United States arrive via ports of entry in other European countries.
Spain has a high structural unemployment rate, with the latest official figures for the first quarter of 2022 standing at 13.65 percent (down from first quarter of 2021 at 15.98 percent).
Spain places a high priority on Latin America’s commercial and economic situation due to investment, language, immigration, and cultural ties. This close relationship with Latin America can provide strategic synergies like no other European country for U.S. exporters engaged in both Spain and Latin America.
Investment plays a key role in the bilateral economic relationship. Many major U.S. companies are present in Spain, especially in the industrial sector – automobiles, chemicals, pharmaceuticals, industrial machinery, etc. SelectUSA/Bureau of Economic Analysis figures for 2021 show cumulative U.S. investment in Spain at USD 39.0 billion, an increase of 3.3 percent from 2020. In 2019, U.S. firms in Spain employed 180,600 people with total sales reaching USD 92.5 billion.
Spanish investments in the United States increased substantially in recent years, making Spain the 10th largest investor in the United States in 2020, according to data from the U.S. Bureau of Economic Analysis. Much of the investment has taken place in the past ten years, growing from a stock of USD 14 billion in 2006 to approximately USD 80.8 billion in 2021 (by Historical Cost-Basis-UBO). According to the same source, in 2019, Spanish owned U.S. subsidiaries employed 92,000 people with total sales reaching USD 64.6 billion.
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