Electricity, tourism and constructions are probably the industries that represent quite well the excitement, growth and innovation of the Spanish economy over the last 10 years.
Electricity consumption has grown 40% during the last six years and Endesa (the number one electricity company in Spain) is the dominant operator in Latin America, which obviously represents a big market. The electricity thus has become a testing ground for foreign investors. As largely known, Eon has been trying to take over Endesa by offering 36.8bn euros (initially 27), and Spain has done everything possible to frustrates its dreams, showing a quite strong protectionist attitude. Also, in term of alternative energy Spain is among the world’s leaders in generation of this type of energy on per capita basis, and this thanks to government’s incentives as well. Iberdrola has recently announced investments of 3bn euros in turbines and wind farms around the world.
Following the construction of the beautifully designed Terminal 4 of the Barajas airport in Madrid, Spain has become the second biggest destination for low cost flights originating in Europe after the UK, and Madrid has became the hub of European traffic.
Low cost airlines has clearly became the major actors within the airline industry and many of them are opening or have already opened their second base in Spain: the additional capacity at Barajas in fact means that airlines can turn around their planes faster and at the very end increase capacity and revenues. Moreover, Spanish tourism, unlike Italian tourism, is now not only about attracting millions of people for a two–three weeks a year. The strategy is different: it is about luring over rich tourists to buy houses where they can come for nine weeks a year and then come there living when they are retired (bringing all their money with them).
The boom of the construction sector over the last years in Spain has been largely discussed and often pointed out as the major reason for the GDP growth. Recently, two phenomenons, in part contradicting each other, are occurring. On one hand, due to soaring prices and to cash abundance, real-estate companies have started to expand abroad. On the other, the sector continues to attract foreign investors: Spain receives 12% of total European retail investment, second only to German. However, is true that level of foreign investment, thought still high, has started decreasing over the last 3 years compared to the past 10 years.