The Canary Islands Confederation of Entrepreneurs highlights the “unexpected strength” of the island’s economy, but warns of “signs of recession”.

The Confederation of Entrepreneurs of the Canary Islands (CCE) pointed out this Wednesday that the island’s economy, although showing “better resistance than expected”, also presents “signs of recession” conditional on “uncertainty”. , “they inhibit growth”. The situation “may intensify in the second half of the year,” the organization warns in a joint statement of April 2023.

With these forecasts, the EEC considers it “fundamental” to promote measures to support the manufacturing sector in the country and to maintain employment, especially in the Canary Islands. Greater dependence on the external environment.”

The CCE’s current report says that according to provisional data from the ISTAC quarterly accounting of the Canary Islands, subject to possible revisions, it would have grown by 2.9% in the first quarter of 2023, which would be 2.6 points. (+0.3%) above the estimated quarterly increase in the fourth quarter of 2022.

This growth was “mainly” due to the dynamism shown by services activities, which would have accelerated their growth to 3.4% in the first quarter, compared to an increase of 0.5% in the previous quarter.

Reactivated and growing tourism

Regarding tourism-related indicators, they note that the growth of the economy and employment in the Canary Islands is “on a clear positive trend confirming the reactivation of an important sector”.

In this sense, he cites the latest AENA statistics on the entry of foreign visitors through the archipelago’s international airports, which show that the number of foreign tourists in April grew by more than 23% in the Canary Islands. For the same period in 2022, despite a 12.2% month-on-month decline in foreign passenger arrivals last month, forecasts for summer airline seats are “optimistic”.

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They also noted data on social security connections in the Canary Islands, which increased by 0.8% in April, up 7,018 employees from the previous month and up to a total of 877,161 workers. In this case, he qualifies that this is “less growth than seen at the state level, which increased employment by 1.6% at the end of last April, adding 328,659 additional troops.”

Unemployment data in the islands

However, he points out that, based on year-on-year data, employment in the Canary Islands would have increased by 4.5% over the past year, an increase “over there” in Spain overall by 37,495 workers over data for April 2022. There was also a rebound of 2.9%, representing 580,365 more workers than a year ago.

Therefore, within this framework, registered unemployment in the Canary Islands fell by 2% in April, representing 3,669 fewer unemployed, although year-on-year data showed that the number of unemployed in the islands “fell by 9.7%, 19,289 fewer unemployed than the year before”.

April also included a 0.8% rise in CPI in the Canary Islands, with the largest growth in prices in the clothing and footwear group, whose CPI in the archipelago increased by 14%, “almost double the national total (+7.5%)”.

Based on these data and the situation of the Canary Islands, CCE, the situation of the world economy has shown a “better than expected evolution” in the first months of 2023, due to the “less tension” energy markets are now facing , the normalization of international supply chains and the “good results” seen in production activities. “, specifically linked to the Services.

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Even so, he stresses, there are risk factors that will “continue to chill” the recovery, such as “political monetary tightening and, in addition, “higher” inflation rates in advanced economies, particularly in key components, or geopolitical tensions. Financial instability fears that have emerged in recent months.”

Islands come out of the “pit”.

The CCE’s warning comes after reports of unemployment in the islands last April, with regional president Angel Victor Torres promising the archipelago’s economy had recovered and the islands had “got off that cliff”.

He also described the staff figures as “good news” and stressed that 80,000 more people were currently working in the Canary Islands than when he took office in 2019.

“These are the best data in 15 years and the best in the historical series, despite the fact that 400,000 people live here,” said the Canarian president, who also highlighted the drop in youth unemployment in the assembly. 30% less.

During the pandemic, he said, 14,000 unemployed young people had “already left”, and he stressed that unemployment had also been reduced among vulnerable groups such as the long-term unemployed and women.

“This is the way. We have the economic strength to put almost a million people to work in the Canary Islands and to reduce unemployment that we have not seen in decades. That is where the real recovery and strength of the Canary Islands economy lies,” concluded Torres.

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