'Let's prove them wrong': Spanish economy minister responds to US criticism
Spanish Economy Minister says Europeans must stay united and keep focused on integration after the Trump administration said the continent's economy is suffocating under excessive regulation and weak leadership.
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00:00Spain is the fastest growing economy among the euro area expected to see GDP growth of 2.9%
00:14this year extending explosive growth since 2021 to debrief on 12 minutes with we're joined by
00:22the Spanish economy minister Carlos cuerpo minister thank you so much for joining us
00:28obviously you've had a very strong growth performance but before we get into that I
00:32want to ask you about the national security strategy that was put out by the US government
00:38they say Europe is weak how do you respond well you know there is an easy response I think to
00:44statements documents that come from abroad is that we need to somehow go from reacting to outside
00:52shocks to really get to action there is urgency to really provide and to really push
00:58for our policy agenda and we should be talking we should be having specific deadlines we should
01:03be moving ahead with our roadmap but when they tell you and you're the Spanish economy minister and
01:08also an important country in the European structure when you hear they are weak the leadership is weak
01:14there's too much regulation there's successive migration the green policies are wrong they are
01:19not growing are you offended well you know this is very personal but the reaction that it instills in
01:26me is a reaction of really proving them wrong okay I think that's what we should be moving and
01:31that's why we have to really enact all those policies and start moving that that's that's
01:36I think that's a proper reaction to all these statements we have to keep on moving there's
01:39a question permeating in Brussels which says this has nothing to do with national security is political
01:44interference and the goal of this administration is to dismantle the EU from within is that a
01:49credible threat well again I think Europeans were very much aware of the importance of unity within the EU and how
01:55much the European Union protects us and I think from the Spanish perspective that's a there is no
02:01case whatsoever in terms of really thinking about any other scenario but going ahead in terms of
02:07integration further integration within the EU we've seen this year this issue of unanimity is becoming a real
02:13problem in the EU is unanimity killing the EU from within that's a real threat well again I think we are
02:19trying to find ways on important decisions such as the funding for Ukraine to avoid the blocking of
02:26of these support and we will find it I'm sure in the next few weeks we will find ways to in the first
02:31and assets will happen I think in the end we will be able to go ahead with the ensuring financing for
02:37Ukraine which is the most important element at this point because it has to do with Ukraine
02:41security but also with European security and thus European economy but you're saying funding you're not
02:46saying the reparations loan so that means maybe it's not a reparations loan it's something else
02:49the Belgians continue to say we don't like it you know we're working hard to be able to go ahead with
02:54the reparations loan from the Spanish side we're pushing ahead as well we think that there is space
02:59to go ahead both legally and politically we will have to again and go ahead together with our colleagues
03:05with the rest of the member states and see to what extent again we can do that in the next few weeks
03:10okay and we've got to talk about Spain there's been a real reversal between the core and the south
03:15how sustainable having said that it's a three percent GDP growth for this country well it's not just a
03:20short-term story it's now a structural change in the Spanish economy and how we are being able to lift up
03:27our potential GDP growth which is the key for sustainability of our public finances as well going
03:31ahead so there is it's not just being able to get out of COVID without scars but really modernizing
03:37our economy that's the actual success story of Spain how long can you keep it up though so what
03:42we're aiming at is a potential GDP growth of around two percent which is doubling pretty much what we
03:47had pre-COVID so that's essential that's key for us you know very well however your critics would say
03:52there is no structural story it's European money and a boom in tourism what do you respond to that
03:57well there are many signals to actually look at where you can see this structure change for example you
04:03talked about tourism but what we have now in Spain is a boom in non-tourism services which are higher
04:08value-added services actually we export more despite of being in record years in tourism we export more
04:15in non-tourism services which are IT financial accounting services than in tourism so the jobs are going to
04:21basically high end sectors innovation Spain is the third fastest growing country in terms of its startup
04:30ecosystem for the past three years so that's all these indicators really pointing towards the
04:34structural change but the funding from the European Union obviously after the pandemic played a big role
04:38in the economy you also can see that those the funding the next generation EU which is a program
04:45built around it will end next year in 2026 what impact is this going to have in Spain so we have
04:50a fully fledged structural reform agenda labor market business environment startup law that are creating
04:56the conditions also for this growth to be sustained going forward and then on the investment side a
05:01strong investment push 80 billion in transfers for Spain so that we could actually really put the
05:07stress on those areas that we think are sectors of the future including the digitization and the green
05:12of course energy which are the key vectors for Spain also going forward so you're not concerned this
05:17funding is no longer there and that's going to have a negative impact on you well you know there
05:21there are two elements here so one is we will be discussing the medium-term financial framework
05:25for the EU and that will start actually in December in the European Council as well and we think that
05:31there is need for Europe to be somehow forward-looking and ambitious in the in terms of the size of its budget
05:38you know very well that Draghi has been putting on the table financing needs for our investments that
05:44are above five percent of GDP and our budget barely reaches two percent and that's including all
05:49all different items so we need to somehow be consistent on both fronts we will be fighting
05:54for a for an ambitious MFF you also call for joint debt and of course and there are many elements
06:00associated with the element of mutualization of or joint issuance of debt one of them is to reinforce
06:07of course the euro as a as a strong currency going forward because what we've seen is that we need a
06:13liquid market in terms of your denominated debt and that will come again as well from from further
06:19mutualizing debt or from further issue and just to end this chapter before we move on on the Spanish
06:25economy in particular there's the numbers which objectively are very good but there's also the
06:30politics at the start of the year I remember you told me we will have a budget we are going to
06:33present and it's going to be successful it's the end of the year there's no budget you've been rolling
06:37over constantly now your critics would say this is not just wrong but it's undemocratic well you
06:43know we are now in the process of really putting forward the draft budget but we've heard this
06:47before many times I know there is a specific a clear commitment from the president to actually
06:53beginning of next year really presents the draft budget in Congress so that we can discuss it and
06:59hopefully agree on it you know also likely what we have in Spain is these provisions within our law to
07:05be able to roll over the budget from one year to the other and that actually but a rollover is an
07:11exemption the criticism is that this is becoming too normal and that is not very democratic what do
07:15you respond the constitutional obligation is to present a draft we will present a draft and from
07:19then on hopefully we can agree on it because it's important for citizens to be able to see what the
07:25policy objectives are in terms of money in terms of where we allocate what items are prioritized throughout
07:31the the budget in fiscal terms we're complying also with EU fiscal rules so we we are within the group
07:36of good pupils with good students in terms of fiscal and also macro imbalances that's just as you know
07:41it's rare to not have a budget for so many years we know it's an it's an exception as you just called it and
07:46we will try again to to have it approved we will present it and we will we will go ahead with our
07:51partners and and associates within the the parliament to be able to to to get it ready but you're also
07:56different to the rest when it comes to migration in the European Union we've seen now much harder
08:01line obviously there's a conservative majority now there's pushing for repatriation asylum seeking
08:07has to be monitored much more closely family ramification it's the same in Spain however we're
08:12seeing the numbers when it comes to migration growing but you say that is adding to the economy
08:17is migration for you an opportunity or a problem migration is a big opportunity for Spain you don't
08:24think is a problem on to the country I mean migration has proven to be a very positive factor for for
08:29these very positive figures in terms of growth for Spain and you can look at them in absolute terms so
08:35how much it has contributed to growth how much it has contributed to growth in per capita terms as
08:39well there's an analysis from the Bank of Spain saying that between 0.4 and 0.7 percentage points of
08:44per capita growth for the past three years which per capita growth in total was around three percentage
08:49points point four to point seven were due to migration with thanks to migration but some
08:54markets because the vast majority of migrants coming to Spain are coming from Latin America so
08:58there's a cultural linguistical also to common ground some would say there are some cultures that
09:06are more difficult to assimilate than others and that is a problem when you hear that is there an
09:11undertone of racism in it well there is you think the migration policy coming out of the European Union
09:15has an undertone of racism no I think those sort of statements have an undertone of racism and and
09:22I think we should really combat that through data and through evidence and you know what it what what
09:27those statements or what what that evidence tells to me is that the the better the integration policies
09:33the greater the in the positive impact focuses on returns in Europe is the migration policy wrong now
09:39that's true you know from the Spanish perspective that's a somehow the best way for us to be able to
09:44understand or put these discussions forward what we know is that the bigger the effort in terms of
09:50integrating migrants through regular flows the bigger the impact in social but also in economic terms
09:56and and when we regular is there is there a second chance or is this just a question of returning people
10:01back to their country that was agreed this week you know in in when we think about the Spanish case you
10:06mentioned people from Latin America 70% of the migration flows are coming to Spain from Latin America but you
10:13know when you ask people there is a disconnect between the data and the reality in terms of migration and
10:18that leads immediately towards a more negative bias in terms of accepting positive migration policies or
10:24integration policies and let me just give you the data so this survey which was run last May by a
10:30think tank in the Basque country was asking Spanish people what they thought was a share of migrants in Spain so the answer was twice the actual share of migrants and they were asking what you think
10:34the unemployment rate within the migrant force is and the answer again was twice the actual unemployment rate and then the third question which was very interesting was what do you think is the share of migrants that is using transfers or subsidies or benefits from the state from the state and the answer was five times the actual rate so again there is a clear disconnect
11:04that happening well I think one blame one of the elements that is happening is is of course is this force narratives and and this fake news in terms of the impact of migration that are leading towards a negative bias and that's not grounded in data and there are no negative implications for migration for you but again you just have to look at the figures and in our case when you look at the impact of migration of course there are challenges going forward
11:34on integration and and development policies in origin countries to allow for those uh... people to have
11:41opportunity job opportunities in their own countries and therefore
11:44also reduce the danger that they have to uh...
11:47endure by uh... in coming to our countries in an irregular manner and also reduce
11:51these irregular flows
11:52well minister thank you so much for joining us on your news
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