Spain’s public deficit to hit $126 billion this year

Spain’s public deficit will balloon to around $126 billion this year, representing 10.3 percent of gross domestic product (GDP), more than triple last year’s deficit, the country’s government said on Friday.

The public deficit, as a percent of GDP, impacts Spain’s capacity to get financing.

The figures are part of Spain’s updated outlook for 2020 presented to the European Commission.

“These are prudent predictions,” said Spanish Finance Minister Maria Jesus Montero, at a televised news conference.

Spain’s unemployment rate is expected to grow to 19 percent by the end of this year, up from 14 percent now, the government added.

The International Monetary Fund (IMF) forecasts that Spain’s economy will shrink by 8 percent in 2020, before rebounding and growing 4.3 percent in 2021.

Spain has the world’s second-highest number of confirmed coronavirus infections after the United States, according to Johns Hopkins University. The rate of infections has now slowed down.

It has its state of emergency home confinement order is in its 7th week.

Spain’s tourism sector has been the most affected by the restrictions, said Economy Minister and Deputy Prime Minister Nadia Calviño during the news conference.

The recovery doesn’t rely just on Spain but on the international context and on the nations that are the origin for tourists to the country, Calviño added.

Tourism makes 12.3 percent of Spain’s GDP and 2.6 million jobs, according to Tourism Ministry figures. The tourism industry is at a standstill due to coronavirus.