Spain is a country located in southwestern Europe on the Iberian Peninsula. It is south of France and east of Portugal. It shares its borders with five countries including France and Portugal as mentioned previously, along with Morocco, Gibraltar, and Andorra. With a radius of over 31,000 square miles, Spain is recognized as the fourth largest country in Europe, and the fifty-second largest nation of the world (thoughtco.com). Most of Spain’s lands consist of flat lands, which are surrounded by small hills. The Pyrenees Mountains, which run across Spain and France, do, however, dominate the northern part of the country. The climate of Spain differs depending on each part of the country. In the inland, the summers are hot and the winters are cold. Along the coast, you can expect both summers and winters to be cool and cloudy.
Spain was founded as its own nation in 1479. Its capital (and largest city) is Madrid, with a population of over three million inhabitants. The meaning of the name España comes from the Phoenician word i-spn-ya, meaning “land where metals are forged”. Spain’s national day is October 12th, in which they celebrate Columbus’ arrival in the Americas.
I. SOCIOECONOMIC AND CULTURAL FACTORS
According to Worldometers, the current population of Spain is 46,068,824. The current male to female ratio is1:1. The number of foreign nationals is approximately over four million. Fifteen percent of the population are under the age of 15, 68% are between the ages of 15 and 64 years old, and 17% are 65 years and older. The total life expectancy in Spain is approximately 81 years, totaling above average compared to other countries. The people of Spain are referred to as Spanish, and they speak Spanish, with 99% of the population speaking the language. The Spanish language is also known as Castilian.
According to statistics recorded in the 1980s, in Spain, those aged 25 or over have attained less than primary education (46.1%), of which 34.5% have no formal schooling, primary at 34.0%, lower secondary at 9.3%, upper secondary at 3.3%, and higher education at 7.1% (1981). Of the literate population, those aged 15 or over is approximately 26,004,225 or 92.8% (1983) (atlapedia.com). In Spain, over 50 percent of the total number of unemployed have only primary education. Only a little over 20 percent of unemployed people have post-secondary education (stlouisfed.org). In the chart below, we can see that in the past few years, Spain’s unemployment rates have gone down significantly. At the beginning of January of 2014, unemployment rates were nearly reaching 26%m and by January of 2017, the rates have lowered by approximately 7%, reaching almost 18% (tradingeconomics.com).
The employment rate of women in the Spanish labor market equals 52% and thus is below the European Union average of 58.5%. Also, the share of women actively looking for work (22.3%) lies far above EU average of 9.8% (ee.europa.eu).
In Spain, you will find people from different cultures, including both foreign tourists, immigrants, and natives. As far as natives, there are three ethnic groups that comprise most of the Spanish population. These include Castilians, Catalans, Basques, and Galicians. Castile, which makes up 3/4ths of the Spanish population, located in central Spain, covers approximately 60% of the country’s total area. Basques, found in both France and northwest Spain, is considered the oldest ethnic group in Europe. They make up approximately 5% of the Spanish population. Catalans make up almost 13% of the Spanish population. They are mostly populated in northeastern Spain. Galicians, also known as Gallegos, can also be found in northern Spain. This ethnic group, just as Basques, comprises of just over 5% of the entire Spanish population. Native born Spaniards make up 86% of the total population. The other 14% are immigrants from countries in Latin America (Spain’s former colonies) including Argentina, Chile, Cuba, Ecuador, and Puerto Rico, along with Africa and the Philippines.
Stated in the Spanish constitution, freedom of religion is guaranteed for all. The majority of the population practice Catholicism. Catholics comprise of 97% of the population, while the other 3% comprises of people practicing Protestantism, Judaism, Islam, and Hinduism. All of the before mentioned religions have churches, mosques, etc. to be able to practice their rituals (spain.info).
The Spanish are known for their culture, art and architecture. They are known worldwide for their popular Spanish foods, drinks, and lively festivals, along with their daily siestas. The Spanish are also known for eating very late in the day; lunch meals are not eaten until past 2PM, and dinners are usually hosted past 9PM on the weekdays, and 10PM on the weekends.
II. POLITICAL AMD LEGAL CLIMATE
The name of the government is called Kingdom of Spain. Spain is a parliamentary monarchy whose government is defined by the Constitution of Spain. The Constitution of Spain, which was adopted in 1978, focuses on basic rights and duties of citizens, structure of the government, and principals of economic policy. The purpose of their Constitution was to serve as a means to transition Spain into a democracy. The government is currently run by Mariano Rajoy who is the Prime Minister. Just like the United States, Spain has 3 government branches which include the executive, judicial, and legislative branches. Spain’s legal system is known as the Judiciary of Spain. It consists of courts and tribunals. It is based on laws rooted in Roman law as opposed to the usual common law.
In the chart below, it is evident that Spain has had many ups and downs in terms of political stability. From 2006-2010, Spain saw a weak decline reaching almost -.50 in their government. It was not until recent years that Spain was able to stabilize above the index (govindicators.org).
III. ECONOMIC CLIMATE
Spain has the 12th largest economy in the world. That is, in terms of per capita income. Spain’s current GNP per capital is 32,030 dollars. In 2013, Spain’s Gross Domestic Product was measured at 1.3 trillion dollars. In the European Union, it is the fifth largest mixed capitalist economy. In February of 2017, Spain’s CPI, or current inflation, was 2.97%. This means that that percentage is the average price which consumers spend on products or services. The currency of Spain is the Euro. Their exchange rate is approximately €.94 Euros to one US dollar, or one Euro to $1.06. Spain is a member of the European Union, which has become the most powerful regional trading bloc in the world, with a GDP exceeding that of the US. Spain is considered the fifth largest recipient of FDI stock. During the first two quarters of 2016, FDI declined by more than 29% compared to the same period in 2015, reaching EUR 6.7 billion (standardtrade.org). With Spain having an open economy, the competition to rise in exports has increased. Because of improved productivity, Spain has made a positive contribution to the external sector growth of the economy.
Spain’s standard of living ranks above average when measuring their work/life balance, but do rank below average in income and wealth, along with education, jobs, and earnings. Approximately 57% of Spaniards in their teens till age 64 have paid jobs. The average salary in Spain averages around €2500 a month. Spain’s major domestic industries include metals, chemicals, textiles, apparel, and food and beverage. Spain is also the second largest in the foreign-tourist industry, which drives in a large portion of their capital. The most developed part of Spain’s infrastructure is their train system. The most commonly used train is the Madrid-Barcelona high-speed rail line. This rail line connects Spain’s capital Madrid to Barcelona with incredible speed, reaching each destination within two and a half hours.
IV. ANALYSIS
Reaching over seventy-five million visitors per year, Spain drives in a lot of capital from tourists visiting the country. Tourism in Spain contributes approximately 11% of Spain’s GDP. Because of these statistics, I would recommend those working in the tourist industry to invest in Spain. Spain is the third most visited country in the world, raking in a total of over eighty billion dollars in earnings solely from tourists. Spain, being a historically remarkable territory full of famous art and architecture, will always be a country of interests for people worldwide, with a continuing growth of tourists every year. Aside from that, Spain has easy access to transit, especially for others living in surrounding European countries. For other Europeans, Spain is easily accessible by air, train, and road, and for a fair and reasonable price. With wonderful weather year round, Spain is always a vacation destination.
Although Spain may not be in its best terms because of its economic crisis between 2008 and 2013, their numbers have finally begun to rise, slowly creating a stable economy. Since the government decided to rescue the economy using the money of the taxpayers after the recession, the markets have stabilized and have initiated a growth in market investments in Spain. Spain’s GDP growth rates since then have been on the rise, and are predicted to keep doing so.
One reason to invest in Spain includes low prices resulting from the recession. The post-recession period has resulted in a decrease in many prices across the country, most specifically in real estate. Spain is known to offer lower barriers of entry for investors seeking investments with hopeful and opportunistic outcomes. Just as Bill Gates and Goldman Sachs invested in the Spanish economy in 2014, I would suggest that businesses establish facilities and invest in Spain for now and for the years to come. Spain promises much opportunity and positive growth, especially seeing how they have risen from a recent recession and negativity in Spanish markets. Middle Eastern companies are also investing in Spain. Companies including banks and airlines are penetrating the Spanish market, in hopes that their actions will be followed by other investors worldwide.
Spain is also known for having favorable legislation on patents and trademarks. For example, knowing that Spain is one of the top countries in the world with more renewable energy patents per capita (more than the US), provides an insight that Spain is a growing and innovative country. To investors of technology, Spain is an attractive destination, providing positive growth for the country when handling the products that will be defining factors of our future.
Being a part of the European Union means that Spain has free access to the world’s largest market. Spain, along with its investors benefit from free movement of goods and services, no intra-community tariffs, and most importantly, dealing with a sole currency. Spain is also ranked as the 9th most open country to international investments (investinspain.org). Twenty-six of the largest Spanish Companies are part of the Forbes Global 500 major companies in the world, meaning yours can be too!