Can Spain change its economic model?

Escrito el 6 noviembre 2009 por en Economía española

The economic crisis that is unfortunately affecting Spain requires a collective effort aimed at changing the economic model. This change consists of moving over from a production apparatus, such as the present one, which is focused on sectors that are not highly exposed to international competition, such as certain services and construction, to another that is designed to produce more goods and services for exports. In short, the aim would be to increase the competitiveness of our economy; in other words, to give more importance to the sectors and businesses that export and also to those that presently compete with imports in our country. Consequently, Spanish enterprise is at a decisive moment for its future.

This is due to the fact that the peculiarities of the Spanish economic crisis can be found in the current Spanish production model, which is based on low-productivity services and industry and on the construction sector, which now threatens with high unemployment due to a reduction in activity. It would be absurd to attribute responsibility to international competition (imports) and to the globalisation of our businesses’ lack of competition or the internal malfunctioning of our economy. That responsibility must be attributed to the inflexibility of the employment market, the absence of competition in certain key economic sectors, the presence of a collective subsidy culture and, therefore, one of public spending, the shortage of technological innovation, the problems that affect the financial system, the deficient education model and the low-level adoption of modern, more efficient management systems.

Is it possible to change the model? Under these circumstances, the possibility of changing the economic model will depend on our capacity for solving the problems that affect the financial system and making our economy and employment market more flexible, as well as our capacity for increasing our technological capital. Consequently, it is a question of improving production and the competitive structure to increase exports and Spanish investment abroad.

Unfortunately, during the last three years for which information is available, Spanish exports of high-tech products have fallen in absolute terms by almost 20%. Improved technology, the restructuring of production, the promotion of national saving and increased competition must be the stepping-stones along the road towards this new economic model. The main players in the model must be the old and new businesses that invest in R&D and innovation; in other words, those that supply innovation, but also those that demand innovation.

Consequently, the public sector must aim its spending at increasing the productivity and, consequently, the competitiveness of our products, such as the reform of the educational model to promote excellence and effort, motivate activities that generate R&D and innovation and speed up the construction of infrastructures. In short, we must continue our commitment to an economic model that is open to the exterior and avoid protectionism in the Spanish economy. The solution to our problems does not lie in protecting our economy from foreign competition, but rather in increasing the quantity and quality of our exports.


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