2020 ends with a world economic contraction above 4%, the biggest GDP decrease since World War 2. Among developed nations, growth comes to a standstill after the renewal of activity in Q3 as a result of the surge in cases and the movement restrictions. Services, especially those related to the hotel and leisure industry, experience the biggest losses. On the other hand, industry is advancing at a steady rhythm as international trade is reactivated. In the US, the perspectives appear to indicate that the economy will register positive growth in Q4 2020, in spite of the recent surge in Covid-19 cases. In this context, the Fed has improved its growth forecasts and has announced that it will maintain its stimulus policy until there are improvements in employment and inflation reaches the target levels in the medium- to long-term (most likely at the end of 2022). In the Eurozone, where restrictions have been tighter, a new contraction in GDP in Q4 is expected. Also, the outlook for Q1 2021 indicates that economic activity will not experience any significant growth, in spite of the vaccination campaigns in place by a variety of governments in member states. In emerging economies, although a slight recovery is expected due to the reactivation of trade and the increase in prices for raw materials, different levels of performance can be observed. China, with the spread of the virus under control, is the country with the best economic data among the main powers. Other Asian economies such as Taiwan or Vietnam forecast annual growth rates close to 2% for 2020. On the other hand, India’s economy has slumped, with a decrease of -7.4%. In South America, the lack of control caused by the pandemic has added to several structural issues that are dragging down some economies (high levels of debt and unemployment), all of which is conditioning future recovery.

1. Global and Spanish
economic perspectives
Q4-2020
January 2021
QUARTERLY REPORT

2. GLOBAL

3. Main events in 2020
Source: Círculo de Empresarios based on CaixaBank Research and Bloomberg, 2021. 3
January February March April May June
July August September October November December
The European Council
approves a recovery
plan to reduce the
impact of Covid-19.
The Fed establishes a
new monetary policy
strategic framework with
greater focus on job
creation, pursuing an
objective of 2% average
inflation in the medium-
to long-term.
Worldwide deaths from
Covid-19 total one
million people.
The surge in cases in
Spain intensifies and
some movement
restrictions are
reintroduced.
Germany announces
new restrictions and
France introduces a
new lockdown.
The US prepares for the
presidential elections.
China, Australia, New
Zealand and 13 Asian
economies sign a wide-
ranging trade agreement
(the Regional
Comprehensive
Economic Partnership).
The trial phases for
several Covid-19
vaccinations are
concluded.
The UK is the first western
nation to approve the use
of a vaccine against
Covid-19.
The British economy
prepares for its exit from
the EU.
A new US president takes
over after a long election
night.
The ECB expands the
allocation of the debt
purchasing program as a
result of the pandemic to
€1.35 trillion, up until the
middle of 2021.
Spain calls an end to the
state of emergency.
The European
Commission
announces a €750
billion recovery plan
(360 billion in loans
and 390 billion in
transfers) financed
with EU emitted debt.
The price of WTI crude
oil falls into negative
territory.
OPEC and its allies
agree the need for
reductions in the
production of crude oil
until early 2022.
The pandemic continues to
spread and has an impact
on the economy.
The WHO declares the
COVID-19 as a
pandemic.
States of emergency and
the first lockdowns in
Europe are declared.
An outbreak of viral
transmission is
detected in Italy and
Iran.
Stock market
turbulence, with the
biggest market losses in
years.
The US and China sign
their first trade
agreement.
The WHO declares an
international health
emergency due to the
outbreak of
coronavirus which first
appeared in the city of
Wuhan (China).
More stability and
certainty
Less stability and
certainty

4. Economic situation summary
4
Source: Círculo de Empresarios, 2021.
2020 ends with a world economic contraction above 4%, the biggest GDP decrease since World War 2. Among
developed nations, growth comes to a standstill after the renewal of activity in Q3 as a result of the surge in
cases and the movement restrictions. Services, especially those related to the hotel and leisure industry,
experience the biggest losses. On the other hand, industry is advancing at a steady rhythm as international
trade is reactivated.
In the US, the perspectives appear to indicate that the economy will register positive growth in Q4 2020, in spite
of the recent surge in Covid-19 cases. In this context, the Fed has improved its growth forecasts and has
announced that it will maintain its stimulus policy until there are improvements in employment and inflation
reaches the target levels in the medium- to long-term (most likely at the end of 2022).
In the Eurozone, where restrictions have been tighter, a new contraction in GDP in Q4 is expected. Also, the
outlook for Q1 2021 indicates that economic activity will not experience any significant growth, in spite of the
vaccination campaigns in place by a variety of governments in member states.
In emerging economies, although a slight recovery is expected due to the reactivation of trade and the
increase in prices for raw materials, different levels of performance can be observed. China, with the spread of
the virus under control, is the country with the best economic data among the main powers. Other Asian
economies such as Taiwan or Vietnam forecast annual growth rates close to 2% for 2020. On the other hand,
India’s economy has slumped, with a decrease of -7.4%. In South America, the lack of control caused by the
pandemic has added to several structural issues that are dragging down some economies (high levels of debt
and unemployment), all of which is conditioning future recovery.

5. Political uncertainty in historical levels
Source: Círculo de Empresarios based on Economic Policy Uncertainty, 2021. 5
0
50
100
150
200
250
300
350
400
450
500
Jan-97
Aug-97
Mar-98
Oct-98
May-99
Dec-99
Jul-00
Feb-01
Sep-01
Apr-02
Nov-02
Jun-03
Jan-04
Aug-04
Mar-05
Oct-05
May-06
Dec-06
Jul-07
Feb-08
Sep-08
Apr-09
Nov-09
Jun-10
Jan-11
Aug-11
Mar-12
Oct-12
May-13
Dec-13
Jul-14
Feb-15
Sep-15
Apr-16
Nov-16
Jun-17
Jan-18
Aug-18
Mar-19
Oct-19
May-20
Dec-20
Global index of political uncertainty
Points
11th Sep
II Gulf War Global
financial
crisis
Eurozone
recession
European
migration
crisis
Brexit
Referendum
US elections
Beginning of
trade war
US-China
Maximum tension
US- China
(Blacklist of Chinese tech
companies)
WHO declares the state of
pandemic. Beginning of
home confinements
450
350
250
150
0
50

6. From synchronized growth to synchronized contraction
Source: Círculo de Empresarios based on IMF, 2021. 6
58%
42%
91%
9%
14%
86%
2009 2018
2020
Synchronized growth
Financial and
economic crisis
Covid-19 crisis
% of countries in contraction vs. expansion of the GDP
Expansion
Contraction
The IMF forecasts that more than 80% of economies will register a decrease of GDP in 2020 as a result of the crisis
caused by Covid-19.
Growth forecasts, IMF January 2021
YoY change (%)
-
3.5
5.2
4.2
-8
-4
0
4
2020 2021 2022
-4.9
4.3
3.1
2020 2021 2022
-2.4
6.3
5
2020 2021 2022
Emerging
economies
Advanced
economies
World

7. First signs of worldwide economic recovery
Source: Círculo de Empresarios based on OECD, CPB Netherlands Bureau for Economic Policy and Analysis and JP Morgan, 2021. 7
-25
-20
-15
-10
-5
0
5
10
15
20
25
70
80
90
100
110
120
130
Feb-01
Mar-02
Apr-03
May-04
Jun-05
Jul-06
Aug-07
Sep-08
Oct-09
Nov-10
Dec-11
Jan-13
Feb-14
Mar-15
Apr-16
May-17
Jun-18
Jul-19
Aug-20
Industrial production UE 27 Industrial production US
World exports (right axis)
Industrial production and global trade
Index 2015=100 and YoY change MA 3 months trade (%)
JP Morgan Composite Global PMI
Points
53.1
26.5
50 = threshold
Expansion
Contraction
Nov-2020
Apr-2020
The increase in world demand improves the evolution of industry and agents’ expectations in
the second part of 2020.

8. Manufacturing PMIs in expansionary phase
Source: Círculo de Empresarios based on Markit and JP Morgan, 2021.
8
After its decrease in Q3 2020, in Q4 manufacturing sentiment improves due to the reactivation of
international demand that translates into requests for new orders.
Manufacturing PMI
50=threshold (values>50 indicate expansion)
Note: in order to calculate the global data, the JP Morgan Global Manufacturing PMI has been used.
67%
of
World
GDP
Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20
Germany 43.7 45.3 48 45.4 34.5 36.6 45.2 51 52.2 56.4 58.2 57.8 58.3
France 50,4 51.1 49.8 43.2 31.5 40.6 52.3 52.4 49.8 51.2 51.3 49.6 51.1
Italy 46,2 48.9 48.7 40.3 31.1 45.4 47.5 51.9 53.1 53.2 53.8 51.5 52.8
US 52.4 51.9 50.7 48.5 36.1 39.8 49.8 50.9 53.1 53.2 53.4 56.7 57.1
Spain 47.4 48.5 50.4 45.7 30.8 38.3 49 53.5 49.9 50.8 52.5 49.8 51
UK 47.5 50 51.7 47.8 32.6 40.7 50.1 53.3 55.2 54.1 53.7 55.6 57.5
Japan 48.4 48.8 47.8 44.8 41.9 38.4 40.1 45.2 47.2 47.7 48.7 49 50
China 50.2 50 35.7 52 50.8 50.6 50.9 51.1 51 51.5 51.4 52.1 51.9
India 52.7 55.3 54.5 51.8 27.4 30.8 47.2 46 52 56.8 58.9 56.3 56.4
Brazil 50.2 51 52.3 48.4 36 38.3 51.6 58.2 64.7 64.9 66.7 64 61.5
World 50.1 50.4 47.1 47.3 39.6 42.4 47.9 50.6 51.8 52.4 53 53.8 53.8

9. Asia: the evolution of diverse levels of GDP
9
In 2020, a significant deterioration in the GDP
of the main Asian economies is expected. In
China, Vietnam and Taiwan, it will be more
controlled.
2020 growth forecasts
YoY change (%)
100
200
300
400
500
600
700
800
900
1995 2000 2005 2010 2015 2020
ASEAN
China
Emerging markets
Economic growth, Asia
Index 1995=100
Source: Círculo de Empresarios based on Oxford Economics and IMF, 2021.
China
Taiwan
Philippines
Malaysia
India
Japan
South Korea
Indonesia
2.3
-12
-8
-4
0
4
8
2019 2020
-5.4
-12
-8
-4
0
4
8
2019 2020
-8.0
-12
-8
-4
0
4
8
2019 2020
-5.8
-12
-8
-4
0
4
8
2019 2020
-2.2
-12
-8
-4
0
4
8
2019 2020
-9.9
-12
-8
-4
0
4
8
2019 2020
2.5
-12
-8
-4
0
4
8
2019 2020
-1.0
-12
-8
-4
0
4
8
2019 2020
Vietnam
2.3
-12
-8
-4
0
4
8
2019 2020
IMF and Oxford Economics growth forecasts

10. Taiwan: regional leader in growth
Source: Círculo de Empresarios based on Oxford Economics, 2021. 10
Evolution of the pandemic
Number of total cases
Evolution of economic activity
Index Dec-19 = 100
Forecasts for growth point to the fact that the Taiwanese economy will register the greatest economic growth
in the region. In the second half of 2020, both national demand (through retail sales) and foreign (through
exports) bounced back.
1
10
100
1000
10000
100000
1000000
Jan-20
Feb-20
Mar-20
Mar-20
Apr-20
May-20
May-20
Jun-20
Jul-20
Jul-20
Aug-20
Sep-20
Sep-20
Oct-20
Nov-20
Dec-20
Dec-20
Jan-21
Number
of
cases
(logarithmic
scale)
China Taiwan
South Korea Japan
80
85
90
95
100
105
110
115
Jan-18
Mar-18
May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
Retail sales
Industrial production
Exports (moving average 3 months)
Taiwan has been one of the economies that has best controlled the spread of the virus with fewer than 1,000
cases in total, which has contributed significantly to its economic recovery.

11. China: “sustained” recovery
Source: Círculo de Empresarios based on Oxford Economics and BIS, 2021. 11
Evolution of the Chinese debt
% of GDP
GDP evolution
%
In 2020, China’s GDP registered an annual growth rate of 2.3% within a context of worldwide economic contraction,
mainly as a result of its control of the pandemic and fiscal incentives by the government.
0
50
100
150
200
250
300
Q2
2014
Q4
2014
Q3
2015
Q2
2016
Q4
2016
Q3
2017
Q2
2018
Q4
2018
Q3
2019
Q2
2020
Q4
2020
Q3
2021
Q2
2022
Household debt Non financial business debt Public debt
-15
-10
-5
0
5
10
15
Q1
2018
Q2
2018
Q3
2018
Q4
2018
Q1
2019
Q2
2019
Q3
2019
Q4
2019
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Quarterly change YoY change
Public debt increased 15% year-on-year in the first half of 2020, reaching 58.7% of GDP.

12. China: a strong upturn in economic activity
Source: Círculo de Empresarios based on National Bureau Statistics of China, 2021. 12
Evolution of Chinese trade
Billions $
Evolution of economic activity
%
70
120
170
220
270
320
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Exports
Imports
-30
-15
0
15
Aug-16
Dec-16
Apr-17
Aug-17
Dec-17
Apr-18
Aug-18
Dec-18
Apr-19
Aug-19
Dec-19
Apr-20
Aug-20
Dec-20
Retail sales
IPI
Investment in fixed assets
In Q4 2020, industrial production increased 7.1% year-on-year, 1.2 pp above the increase registered in Q3
2020, and after the contraction of 6% between January and March. For its part, retail sales slowed slightly.
China’s trade balance improves with the increase in world demand. Exports grew 17% in Q4 2020, almost 10 pp
above Q3 2020 (9%).

13. North America: reduction in the impact of Covid
Source: Círculo de Empresarios based on Oxford Economics and IMF, 2021. 13
• US: surge in new Covid-19 cases; Joe Biden wins the
presidential elections and announces a new
package of fiscal incentives of around $1.9 trillion
(~6% of GDP); the Fed improves its growth forecasts.
• Canada: exceeds its growth expectations in Q3
2020 despite the movement restrictions imposed by
the Government as the number of new cases in the
second wave surges. However, the economy will
contract 5.6% in the year as a whole.
• Mexico: the risk of weak economic recovery in the
second half of 2020 and increased volatility in
financial markets remains. Over the course of the
year, its GDP will shrink 8.9%.
2020 growth forecasts
Yoy change (%)
Canada
US
Mexico
-5.5
-12
-8
-4
0
2019 2020
-8.5
-12
-8
-4
0
2019 2020
-3.4
-12
-8
-4
0
2019 2020
IMF and Oxford Economics growth forecasts

14. US: economic recovery loses steam
*Forecasts.
Source: Círculo de Empresarios based on Oxford Economics and US Bureau of Economic Analysis, 2021.
14
Evolution of the main GDP components
YoY change (%)
GDP evolution
%
85
90
95
100
105
110
115
-10
-8
-6
-4
-2
0
2
4
6
8
10
Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021
Quarterly GDP
Annual GDP
100 = Q4 2019 (right axis)
After increasing 7.3% quarter-on-quarter in Q3 2020, it is expected that US GDP growth moderates to
1.5% in Q4 2020, postponing the recovery of pre-Covid-19 levels until the middle of 2021.
Among the main components of demand, the significant improvement in exports stands out as international
demand is reactivated, although there was still a year-on-year decrease of 8.6% in Q3 2020.
-25
-20
-15
-10
-5
0
5
10
Q2 2017 Q4 2017 Q2 2018 Q4 2018 Q2 2019 Q4 2019 Q2 2020 Q4 2020*
Private consumption
Exports
Investment

15. US: the Fed improves its growth forecasts
Source: Círculo de Empresarios based on Fed, 2021. 15
Growth forecasts, December
%
Fed´s balance sheet
Bilions $
In December 2020, the Fed announced that it would maintain the monthly purchases of $120 billion ($80 billion in
Treasury bills and $40 billion in mortgage bonds) in force until substantial improvements with regard to employment
objectives and price stability are achieved.
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
8000000
Dec-07
Dec-08
Dec-09
Dec-10
Dec-11
Dec-12
Dec-13
Dec-14
Dec-15
Dec-16
Dec-17
Dec-18
Dec-19
Dec-20
Currency in Circulation
Deposits of Depository Institutions
Treasury Balance
Total Assets
2020 2021 2022 2023 Long run
GDP growth -2.4 4.2 3.2 2.4 1.8
September forecast -3.7 4.0 3.0 2.5 1.9
Unemployment rate 6.7 5.0 4.2 3.7 4.1
September forecast 7.6 5.5 4.6 4.0 4.4
Inflation PCE 1.2 1.8 1.9 2.0 2.0
September forecast 1.2 1.7 1.8 2.0 2.0
Underlying PCE 1.4 1.8 1.9 2.0
September forecast 1.5 1.7 1.8 2.0
The Fed forecasts a significant improvement in
growth prospects compared to those of
September. For 2020, GDP contraction has
been cut to -2.4% annually (compared to
-3.7%) and the increase in the rate of
unemployment of almost 1pp (from 7.6% to
6.7%) has been revised down.

16. US: inflation below the target level
Source: Círculo de Empresarios based on US Bureau of Labor Statistics and Fed of St. Louis, 2021. 16
Interest rate
%
Inflation evolution
%
In 2020, the decrease in economic activity has maintained prices at low levels and far from the
central bank’s objective.
-1
0
1
2
3
4
5
Nov-10
May-11
Nov-11
May-12
Nov-12
May-13
Nov-13
May-14
Nov-14
May-15
Nov-15
May-16
Nov-16
May-17
Nov-17
May-18
Nov-18
May-19
Nov-19
May-20
Nov-20
Underlying PCE PCE inflation
For its part, the Fed forecasts that the situation will last until 2023, and it will continue with its low interest rate policy.
0
1
2
3
4
5
6
Dec-05
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10
Dec-11
Dec-12
Dec-13
Dec-14
Dec-15
Dec-16
Dec-17
Dec-18
Dec-19
Dec-20
10 year bond yield
Official interest rate

17. US: new decrease in employment
Source: Círculo de Empresarios based on US Bureau of Labor Statistics, 2021. 17
Change of unemployment in metropolitan areas
Var. October 2019 vs. 2020 (pp)
Employment evolution
% and millions of employees
In December, 140,000 jobs were destroyed as a result
of the new movement restrictions due to the upsurge
in coronavirus cases. The hospitality and leisure
industries were the most affected, with 492,000 jobs
lost.
By metropolitan areas, 384 of a total of 389 registered
increases in their rate of unemployment compared to
2019 levels.
< 0.5 pp >5 pp
125
130
135
140
145
150
155
0
2
4
6
8
10
12
14
16
Feb-16
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
Feb-17
Apr-17
Jun-17
Aug-17
Oct-17
Dec-17
Feb-18
Apr-18
Jun-18
Aug-18
Oct-18
Dec-18
Feb-19
Apr-19
Jun-19
Aug-19
Oct-19
Dec-19
Feb-20
Apr-20
Jun-20
Aug-20
Oct-20
Dec-20
Millares
Unemployment rate
Number of employees (right axis)

18. Mexico: slow recovery
Credit evolution
YoY change (%) and growth contributions (pp)
Source: Círculo de Empresarios based on BBVA Research, Banco de México and INEGI, 2021.
Evolution of Global Index of Economic Activity
YoY and monthly change (%)
The lifting of travel restrictions has reactivated economic activity in the short term. However, the risks of
a weaker economic recovery have increased.
Mexico’s Central Bank has warned of an increase in risks and vulnerabilities that could affect the stability of the
country’s financial system.
-2
0
2
4
6
8
10
12
2016 2017 2018 2019 Q3 2019 Q3 2020
Businesses Houses Consumption Total credit
1.6
-4.9
-25
-20
-15
-10
-5
0
5
10
15
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Monthly change
YoY change

19. South America: financial, economic and political instability
Source: Círculo de Empresarios based on Oxford Economics and IMF, 2021. 19
• The depletion of the fiscal incentives and the weight
of public debt have hampered the fragile recovery of
Brazil’s economy.
• Venezuela, Peru and Argentina will be the economies
that register the greatest contractions of their
respective GDPs.
• Venezuela’s economy continues to sink, adding to
one of the biggest migratory crises.
GDP growth
YoY change (%)
100
1100
2100
3100
4100
90
110
130
150
170
Jan-20 Apr-20 Jul-20 Oct-20 Jan-21
USD/ Brazilian real USD/ Chilean peso
USD/ Colombian peso USD/ Bolivar (right axis)
Evolution of currencies vs. dollar
Index Jan-2020 =100
Brazil
-4.5
-12
-8
-4
0
2019 2020
-10.6
-12
-8
-4
0
2019 2020
Argentina
-5.9
-12
-8
-4
0
2019 2020
Chile
-8.5
-12
-8
-4
0
2019 2020
Bolivia
Peru
Ecuador
Colombia
Uruguay
-34.9
-40
-30
-20
-10
0
2019 2020
-4.2
-12
-8
-4
0
2019 2020
-11.3
-12
-8
-4
0
2019 2020
-6.4
-12
-8
-4
0
2019 2020
-7.5
-12
-8
-4
0
2019 2020
IMF and Oxford Economics
growth forecasts
Venezuela

20. Brazil: fragile economic upturn
Correlation between public debt and public deficit
% of GDP in 2020
Source: Círculo de Empresarios based on Oxford Economics and IBGE, 2021.
In Q3 2020, Brazil’s economy bounced back by 10.3% quarterly, although in year-on-year terms, it
registered a decrease of 3.9%.
GDP evolution
Quarterly and YoY change(%)
Unemployment rate
% active population
Brazil
Argentina
Colombia
Chile
Peru
Mexico
The high levels of public debt and deficit, worsened by the Covid-19 assistance packages, could hamper
recovery, to which the possibility of a forthcoming tax hike is added.
Public
debt
Public deficit
0
20
40
60
80
100
120
-18
-16
-14
-12
-10
-8
-6
-4
-2
0
-3.9
-15
-10
-5
0
5
10
15
Q1
2015
Q2
2015
Q3
2015
Q4
2015
Q1
2016
Q2
2016
Q3
2016
Q4
2016
Q1
2017
Q2
2017
Q3
2017
Q4
2017
Q1
2018
Q2
2018
Q3
2018
Q4
2018
Q1
2019
Q2
2019
Q3
2019
Q4
2019
Q1
2020
Q2
2020
Q3
2020
Quarterly change
YoY change
14.6
6
8
10
12
14
16
Q1
2015
Q2
2015
Q3
2015
Q4
2015
Q1
2016
Q2
2016
Q3
2016
Q4
2016
Q1
2017
Q2
2017
Q3
2017
Q4
2017
Q1
2018
Q2
2018
Q3
2018
Q4
2018
Q1
2019
Q2
2019
Q3
2019
Q4
2019
Q1
2020
Q2
2020
Q3
2020

21. Venezuela: inequality levels remain
Main receiving countries of inmigrants from Venezuela
Stock of number of people
Source: Círculo de Empresarios based on IMF and ONU, 2021.
The strong economic contraction and the fall in GDP per capita, along with hyperinflation are
causing an exodus of the Venezuelan population that is forecast to be the biggest in South
American history.
GDP per capita evolution
YoY change (%)
Inflation evolution
YoY change (%)
0
100000
200000
300000
1990 1995 2000 2005 2010 2015 2017
Colombia Spain US
0
5000
10000
15000
20000
25000
30000
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Argentina Brazil
Chile Colombia
Venezuela
1
10
100
1000
10000
100000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
Note: IMF forecasts

22. UK
Europe: recovery crippled by the new waves of the
pandemic
22
In Europe, the second wave has caused a new
contraction in economic activity in Q4 2020.
Europe is going to be the continent most
affected by the Covid-19 crisis in 2020. It is
estimated that the GDPs of both the Eurozone
and the EU27 will end 2020 with decreases of
-7.8% and -7.4% annually.
GDP growth
YoY change (%)
GDP evolution, EU27
YoY and quarterly change (%)
-20
-15
-10
-5
0
5
10
15
Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020
Quarterly change
YoY change
Source: Círculo de Empresarios based on Eurostat, Oxford Economics and IMF 2021.
-7.5
-12
-8
-4
0
2019 2020
Austria
Netherlands
-4.3
-12
-8
-4
0
2019 2020
-5.4
-12
-8
-4
0
2019 2020
Denmark
Germany
-10.0
-12
-8
-4
0
2019 2020
2.1
-12
-8
-4
0
2019 2020
Ireland
Greece
-9.0
-12
-8
-4
0
2019 2020
France
-10.0
-12
-8
-4
0
2019 2020
-8.6
-12
-8
-4
0
2019 2020 -11.1
-12
-8
-4
0
2019 2020
Spain
Portugal
-9.2
-12
-8
-4
0
2019 2020
Italy
-4,2
-12
-8
-4
0
2019 2020
Poland
-3.0
-12
-8
-4
0
2019 2020
-3.0
-12
-8
-4
0
2019 2020
Sweden
IMF and Oxford Economics growth forecasts

23. Europe: a worsening of the epidemiological and
economic situation
Source: Círculo de Empresarios based on OMS, Google Mobility Trends and Oxford Economics, 2021. 23
The surge in Covid-19 cases and the movement restrictions for the population in order to control the pandemic
have put a stop to the initial stages of GDP recovery in most European economies.
Evolution of Covid-19 daily cases
Number of new cases per million inhabitants
Movility restrictions and economic growth
Change compared to base level (7 days average) and quarterly
change(%)
Germany
Austria
Belgium
Bulgaria
Czech Rep.
Croatia
Denmark
Slovakia
Slovenia
Spain
Estonia
Finland
France
Greece
Hungary
Ireland
Italy
Latvia
Lithuania
Malta
Netherlands
Polonia
Portugal
Romania
Sweden
UK
-5
-4
-3
-2
-1
0
1
2
3
-80
-70
-60
-50
-40
-30
-20
-10
Q4
2020
GDP
growth
Population mobilty in retail (November and December)
Less restrictions More restrictions
0
10000
20000
30000
40000
50000
60000
Mar-20
Mar-20
Apr-20
May-20
May-20
Jun-20
Jul-20
Jul-20
Aug-20
Sep-20
Sep-20
Oct-20
Nov-20
Nov-20
Dec-20
Jan-21
Austria
France
Germany
Spain
UK
Italy

24. Europe: uneven impact by economic sectors
Source: Círculo de Empresarios based on Google Mobility Trends and Oxford Economics, 2021. 24
The increase in movement and activity restrictions has mostly affected the service sector. On
the other hand, the industrial sector has consolidated its progress in line with the recovery of
world demand.
PMIs, Eurozone
Points
Economic activity, Eurozone
Index 2015=100
0
10
20
30
40
50
60
70
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
Sep-19
Dec-19
Mar-20
Jun-20
Sep-20
Dec-20
Services PMI Manufacturing PMI
70
80
90
100
110
120
Jan-15
Jun-15
Nov-15
Apr-16
Sep-16
Feb-17
Jul-17
Dec-17
May-18
Oct-18
Mar-19
Aug-19
Jan-20
Jun-20
Nov-20
Retail sales Industrial production
Construction production
While retail sales fell 6% monthly in November, industrial production increased 2.5%.

25. Germany: industrial progress continues
Source: Círculo de Empresarios based on Eurostat, 2021.
25
In Q4 2020, an increase in industrial production of 5% quarter-on-quarter is expected. For December, advanced
survey indicators forecast an upturn in world trade and restocking requirements, along with some recovery of the
car industry.
2020 GDP growth
YoY change (%) and growth contributions (pp)
Evolution of the activity
Index January 2020 = 100
-12
-10
-8
-6
-4
-2
0
2
-30
-25
-20
-15
-10
-5
0
5
10
Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020
Public expenditure
Private consumption
Investment
Exports of goods and services
Imports of goods and services
GDP (right axis)
GDP development prospects have improved thanks to the progress of industry. The latest forecasts by IMF
point to -5.4% year-on-year in 2020 (compared to previous forecast of -6.1%).
0
20
40
60
80
100
120
140
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Industrial production
Construcction
Retail sales
Hospitality sector
Car registration

26. Italy: contraction in Q4 2020
Source: Círculo de Empresarios based on Eurostat and Oxford Economics, 2021.
26
The economy grew 15.9% quarter-on-quarter in Q3 2020, although it still remains 5% below levels prior to
the crisis. In Q4 2020, another contraction of GDP is expected as a result of the impact of the new wave
of cases.
GDP evolution and main components
YoY change (%) and growth contributions (pp)
Evolution of public debt
% of GDP
For its part, it is expected that Italy’s public debt will increase by 8.1%, reaching 158% of its GDP in 2020.
*Oxford Economics forecasts.
0
50
100
150
200
250
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
France Greece
Italy Spain
-20
-15
-10
-5
0
5
Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020* Q1 2021*
Public expenditure Private consumption Investment
Net trade Stock GDP

27. France: worsening expectations
Source: Círculo de Empresarios based on INSEE and Eurostat, 2021.
27
The new movement restrictions have had a negative impact on economic agents’ expectations.
Business confidence index by sectors
Index 100=long term average
Evolution of economic activity
Index January 2020 = 100
40
50
60
70
80
90
100
110
120
Jan-12
Apr-12
Jul-12
Oct-12
Feb-13
May-13
Aug-13
Dec-13
Mar-14
Jun-14
Sep-14
Jan-15
Apr-15
Jul-15
Nov-15
Feb-16
May-16
Aug-16
Dec-16
Mar-17
Jun-17
Oct-17
Jan-18
Apr-18
Jul-18
Nov-18
Feb-19
May-19
Sep-19
Dec-19
Mar-20
Jun-20
Oct-20
Manufacturing
Retail and car repair
Services
According to IMF, France’s economy is expected to shrink by 9.0% annually in 2020.
0
20
40
60
80
100
120
140
160
180
200
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Consumption of goods by household Composite PMI
Industrial production Mobility in retail
Car registrations

28. UK: new lockdowns and Brexit
Exports and imports of goods, UK
Yoy change (%)
Source: Círculo de Empresarios based on OECD and ONS, 2021.
The third lockdown as a result of the new wave of the Covid-19 pandemic and uncertainty surrounding the impact
of Brexit, has significantly hampered economic agents’ expectations.
Business and costumer confidence
Index100 = long term average
94
95
96
97
98
99
100
101
102
103
104
Jan-16
Mar-16
May-16
Jul-16
Sep-16
Nov-16
Jan-17
Mar-17
May-17
Jul-17
Sep-17
Nov-17
Jan-18
Mar-18
May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
Business confidence
Costumer confidence
-60
-40
-20
0
20
40
60
Jan-16
Mar-16
May-16
Jul-16
Sep-16
Nov-16
Jan-17
Mar-17
May-17
Jul-17
Sep-17
Nov-17
Jan-18
Mar-18
May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
With the EU
Outside the EU

29. Oil: crude oil prices recover
Source: Círculo de Empresarios based on EIA, 2021. 29
Expectations for greater economic activity and an increase in the movement of goods and people in 2021 has led
to an increase in the price of crude oil. It is currently above the $50 per barrel threshold.
Evolution of Brent barrel price
$ per barrel
In the US, it is expected that the production of fossil fuels will grow until 2022, although it will remain below the
maximum level registered in 2019.
Production of fossil fuel, US
Trillions of Btu
-40
-20
0
20
40
60
80
Jan-20
Jan-20
Feb-20
Mar-20
Mar-20
Apr-20
May-20
May-20
Jun-20
Jul-20
Jul-20
Aug-20
Sep-20
Oct-20
Oct-20
Nov-20
Dec-20
Dec-20
Jan-21
Brent price
West Texas price
0
1
2
3
4
5
6
7
8
Feb-90
Jul-91
Dec-92
May-94
Oct-95
Mar-97
Aug-98
Jan-00
Jun-01
Nov-02
Apr-04
Sep-05
Feb-07
Jul-08
Dec-09
May-11
Oct-12
Mar-14
Aug-15
Jan-17
Jun-18
Nov-19
Coal Petrol
Natural gas (dry) Natural gas (plants liquids)

30. 30
Stock markets (I): markets recover and reach the
highest historical levels
World stock market index (MSCI WORLD)
Points
Source: Círculo de Empresarios based on Bloomberg and CaixaBank Research, 2021.
Evolution of financial variables
YoY change (%)
In Q4 2020, market recovery has continued thanks to
Covid-19 vaccination programs, the European recovery
plan, the Brexit agreement and the Fed’s expansionary
policy.
1500
1700
1900
2100
2300
2500
2700
2900
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Jan-21
+69.4%
-120
-100
-80
-60
-40
-20
0
20
40
-30
-10
10
30
50
70
Volatility
(VIX)
S&P 500 Eurostoxx
50
Emerging
MSCI
Japanese
Yen
Emerging
currencies
Brent Interest
rate US
(10 years)
Interest
rate
Germany
(10 years)
2020
Q4 2020

31. 31
Stock markets (II): differences emerge in the
markets’ upward trend
Evolution of Bitcoin compared to Nasdaq
Points and $
Source: Círculo de Empresarios based on Bloomberg, 2021.
Main stock market indices
January 2019=100
0
10000
20000
30000
40000
5000
7000
9000
11000
13000
15000
Jan-20
Feb-20
Mar-20
Mar-20
Apr-20
May-20
May-20
Jun-20
Jul-20
Jul-20
Aug-20
Sep-20
Sep-20
Oct-20
Nov-20
Nov-20
Dec-20
Jan-21
NASDAQ Bitcoin (right axis)
+728%
+82%
40
60
80
100
120
140
160
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
Jan-21
IBEX
S&P 500
Eurostoxx 50
MSCI Emerging Asia
MSCI Latin America

32. 0
10
20
30
40
50
60
70
80
90
Jan-90
Jan-91
Jan-92
Jan-93
Jan-94
Jan-95
Jan-96
Jan-97
Jan-98
Jan-99
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
Jan-12
Jan-13
Jan-14
Jan-15
Jan-16
Jan-17
Jan-18
Jan-19
Jan-20
Jan-21
32
Stock markets (III): after registering record levels in
March, volatility decreases as they near historical averages
Volatility index VIX
Points
Source: Círculo de Empresarios based on Bloomberg, 2021.
-72%

33. 33
Fixed income: profitability stabilizes in Europe and
bounces back in the US
Evolution of 10 years bond yield
%
Source: Círculo de Empresarios based on Bloomberg, 2021.
Risk premium , Dec-21
Difference with the German bond yield (pb)
106
France
30.4
Portugal
62.0
Spain
64.8
Italy
159.5
Belgium
27.7
Netherlands
12.8
Austria
20.4
Greece
163.7
Ireland
29.9
-2
-1
0
1
2
3
Jan-20
Jan-20
Feb-20
Mar-20
Mar-20
Apr-20
May-20
May-20
Jun-20
Jul-20
Jul-20
Aug-20
Sep-20
Sep-20
Oct-20
Nov-20
Dec-20
Dec-20
Jan-21
US Germany Spain Italy UK

34. 34

35. 35
The third wave of the Covid-19 pandemic, and the appearance of new variants of the virus have worsened
the epidemiological situation at a national and European level, and have led to an increase of uncertainty
surrounding control of the health crisis, the effectiveness of the vaccination campaigns and economic
recovery. In light of the increase in cases and the pressure on hospitals, restrictive measures on activity and
movement have been generally tightened in an attempt to flatten the upward curve.
In this context, the main international organizations have revised their expectations down for 2021. In Spain,
GDP growth between 5% and 7.2% is forecast, after an estimated contraction between 11.1% and 12.4% in
2020.
The Spanish economy remains one of the most affected by the pandemic, with an uneven impact on
economic sectors and regions. This situation can be mostly explained as a result of the greater contribution to
GDP and employment of the sectors that are suffering the most from the restrictions: tourism, and hotel and
catering, among others.
Receipt of the European reconstruction funds, their optimal allocation and effective implementation,
together with the carrying out of the necessary structural reforms, will be essential in order to consolidate
recovery in a scenario in which the main imbalances of the Spanish economy have worsened: the high
levels of public debt and deficit, and the high rates of unemployment, especially among the young people.
Executive summary
Source: Círculo de Empresarios, 2021.

36. 36
Risks
• Greater public finance imbalance. Necessary fiscal consolidation.
• The environmental agenda.
• High rates of unemployment, mostly among the under 25s.
• Advances in digitization.
• Slow and inefficient management and implementation of European funds.
• Negative impact on the sustainability of the welfare state.
• Productivity boost.
• Negative evolution of the pandemic and rhythm of the vaccination process.
• Workforce training and education.
Challenges
• Resulting effect on business solvency and debt restructuring problems.

37. -1090
-684
-465
-1409
-40
-26
-36
-619
-495
-1018
-1156
-5
-1034
-1436
-502
-1000
-1261
-5
-1119
-1186
-296
-3
-111
-1500 -1250 -1000 -750 -500 -250 0
Sweden (40)
South Africa (52)
Russia (20)
Italy (27)
Japan (8)
South Korea (12)
Australia (3)
Germany (36)
Canada (13)
Brazil (46)
Mexico (53)
New Zealand (1)
Argentina (49)
UK (32)
Israel (15)
Portugal (42)
USA (35)
Singapore (2)
France (19)
Spain (23)
Turkey (33)
China (5)
India (18)
Deaths Covid-19 (per. millionhab.)
2.7
2.8
3
3
3.1
3.1
3.5
3.5
3.6
3.6
4.3
4.5
4.5
4.5
4.8
4.9
5.1
5.5
5.5
5.9
6
8.1
11.5
0 2 4 6 8 10 12
Forecast GDP 2021 (% YoY change, IMF)
Health and economic impact of the pandemic
Each country position in the Covid Resilience Ranking (Bloomberg) is shown between brackets. The Index analyses 53 countries and 10 indicators that
measure the impact of the pandemic.
Source: Círculo de Empresarios based on Bloomberg, John Hopkins and IMF, 2021.
37
Growth GDP forecasts 2021 and deaths caused by Covid-19 (from the beginning of the
pandemic until 24th January 2020).

38. 38
* Forecasts
Source: Círculo de Empresarios based on the Bank de Spain, European Commission, IMF, FUNCAS and OECD, 2021.
Recession in 2020 and gradual recovery
2%
2021*
5%/7.2%
Forecasts by the main national and international organizations
YoY change (%)
-11.1%/-12.4%
2020*
2019
State of uncertainty with forecasts conditioned by the intensity and duration of the successive waves of Covid-
19 as a result of the appearance of new variants of the virus, and the efficiency of the economic and political
measures to mitigate the effects on activity and employment.
2020 2021
OECD -11.6 5
IMF -11.1 5.9
Bank of Spain* -11.1 6.8
FUNCAS consensus -11.2 6.3
Government** -11.2 7.2/9.8
European Commission -12.4 5.4
* Central scenario
** Without European Funds

39. Recovery hampered by the new waves
39
GDP and contribution to national and foreign demand
QoQ change (%) and pp
In Q4 2020, GDP rose 0.4% quarterly (16.4% Q3) and fell 9,1% annually (-9% Q3).
In 2020, Spanish GDP fell 11% annually, in line with the forecasts published by the Bank of Spain (core scenario), the
IMF and mail natinal institutions.
YoY change (%) and pp
Source: Círculo de Empresarios based on INE and Eurostat, 2021.
-2.6 -1
1.1
-17.9
16.4
0.4
-18
-12
-6
0
6
12
18
Q2
2008
Q4
2008
Q2
2009
Q4
2009
Q2
2010
Q4
2010
Q2
2011
Q4
2011
Q2
2012
Q4
2012
Q2
2013
Q4
2013
Q2
2014
Q4
2014
Q2
2015
Q4
2015
Q2
2016
Q4
2016
Q2
2017
Q4
2017
Q2
2018
Q4
2018
Q2
2019
Q4
2019
Q2
2020
Q4
2020
Domestic demand (quarterly pp)
External demand (quarterly pp)
GDP (quaterly change)
Eurozone GDP (quarterly change)
-4.4
-3.2
4.2
-21.6
-9
-9.1
-25
-20
-15
-10
-5
0
5
Q2
2008
Q4
2008
Q2
2009
Q4
2009
Q2
2010
Q4
2010
Q2
2011
Q4
2011
Q2
2012
Q4
2012
Q2
2013
Q4
2013
Q2
2014
Q4
2014
Q2
2015
Q4
2015
Q2
2016
Q4
2016
Q2
2017
Q4
2017
Q2
2018
Q4
2018
Q2
2019
Q4
2019
Q2
2020
Q4
2020
Domestic demand (annual pp)
External demand (annual pp)
GDP (annual change)
Eurozone GDP (annual change)

40. Construction and services are the most affected by
the pandemic
40
Source: Círculo de Empresarios based on INE, 2021.
Gross Value Added by sectors
YoY and QoQ change (%)
-30
-20
-10
0
10
20
30
Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020
Quarterly change
-30
-25
-20
-15
-10
-5
0
5
10
15
Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020
YoY change

41. 41
Source: Círculo de Empresarios based on INE, 2021.
Retail sales
Monthly and YoY change (%)
Retail sales fall again after an improvement during
the summer period
In November 2020, retail sales fell
4.3% year-on-year and 0.8%
monthly as a result of the restrictive
measures on activity applied by the
various Autonomous Communities
to halt the impact of the second
wave of Covid-19.
The decrease is less than that
during the complete lockdown
during March and April when sales
fell 14.5% and 31.6% year-on-year
respectively (-15.2% and -20.2% in
monthly terms).
Between January and November
2020, the average yearly variation
was -7.7% compared to 2.4% in the
same period of 2019.
-35
-30
-25
-20
-15
-10
-5
0
5
10
15
20
Dec-07
May-08
Oct-08
Mar-09
Aug-09
Jan-10
Jun-10
Nov-10
Apr-11
Sep-11
Feb-12
Jul-12
Dec-12
May-13
Oct-13
Mar-14
Aug-14
Jan-15
Jun-15
Nov-15
Apr-16
Sep-16
Feb-17
Jul-17
Dec-17
May-18
Oct-18
Mar-19
Aug-19
Jan-20
Jun-20
Nov-20
Monthly change YoY change

42. Improvement in expectations with the
commencement of the vaccination phase
42
Source: Círculo de Empresarios based on IHS Markit and CIS, 2021.
Spanish PMIs, Dec. 2020
50=threshold (values > 50 indicate expansion)
Index of Spanish consumer confidence, Dec. 2020
100=threshold (values > 100 positive consumer outlook)
51
48
5
10
15
20
25
30
35
40
45
50
55
60
65
70
Jan-13
Jun-13
Nov-13
Apr-14
Sep-14
Feb-15
Jul-15
Dec-15
May-16
Oct-16
Mar-17
Aug-17
Jan-18
Jun-18
Nov-18
Apr-19
Sep-19
Feb-20
Jul-20
Dec-20
Manufacturing PMI
Services PMI
37.6
85.7
49.9 48.5
63.1
30
40
50
60
70
80
90
100
110
Dec-08
Apr-09
Aug-09
Dec-09
Apr-10
Aug-10
Dec-10
Apr-11
Aug-11
Dec-11
Apr-12
Aug-12
Dec-12
Apr-13
Aug-13
Dec-13
Apr-14
Aug-14
Dec-14
Apr-15
Aug-15
Dec-15
Apr-16
Aug-16
Dec-16
Apr-17
Aug-17
Dec-17
Apr-18
Aug-18
Dec-18
Apr-19
Aug-19
Dec-19
Apr-20
Aug-20
Dec-20
In December, the service sector PMI was at 48 points, 8.5 more than in November (39.5). The manufacturing PMI
also recovered, reaching 51 points (49.8 in November).
Consumer confidence in December also improved to 63.1 points, from the 55.7 reached in November, although it
remained 22.6 points below pre-crisis figures in February (85.7).

43. 43
Source: Círculo de Empresarios based on INE and Eurostat, 2021.
Index of Industrial Production
YoY change (%)
Industrial Production index by sectors, Nov. 2020
YoY change (%)
Industrial production declines, undermined by the
evolution of the pandemic in Europe
-3.8
-3.6
-1
-3.6
-7.1
1.2
-7.8
-8 -7 -6 -5 -4 -3 -2 -1 0 1 2
General Index
Consumer goods
Consumer durables
Non-durable goods
Capital goods
Intermediate goods
Energy
Industrial production registered -3.8% year-on-year in November, the biggest fall of the past three months.
By sectors, the most affected were energy (-7.8%)
and capital goods (-7.1%).
In November, the Eurozone decrease was 0.6% year-on-year.
-3
-2.1
-14.1
-34
-24.6
-14.3
-5.9 -5.5
-3.2
-1.6
-3.8
-36
-34
-32
-30
-28
-26
-24
-22
-20
-18
-16
-14
-12
-10
-8
-6
-4
-2
0
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Spain Eurozone

44. 44
* People included in the furlough scheme are considered employed people (755.613 - Dec. 31st).
Source: Círculo de Empresarios based on INE (EPA Q4), 2021.
The positive trend in the labour market is reversed
by the impact of the Covid-19 pandemic
Employment and unemployment
YoY change (%) and % of active population
The rate of unemployment in Q4 2020 was at 16.1% of active population.
The number of unemployed people
rose to 3,719,800 in Q4 2020, 16.5%
more than in 2019 (+527,900 people),
after seven years of reduction.
In 2020, the number of employed
people* fall 3.1% year-on-year, to
19,344,300 in Q4 (-622,600 people). In
the private sector, 748,400
employments were destroyed,
whereas 125,800 jobs were created in
the public sector. By sectors of activity,
the decrease of employment in
services (-3.6% YoY; -537,100 people)
and in industry (-2.5% YoY; -70.100
people) stand out.
25.7
23.7
20.9
18.6
16.6
14.5 13.8
16.1
-14
-12
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
14
16
18
0
2
4
6
8
10
12
14
16
18
20
22
24
26
2013 2014 2015 2016 2017 2018 2019 2020
Rate of unemployment Employment change (right axis)
Unemployment change (right axis)

45. 45
* Registered as affiliates but without making any contributions.
Source: Círculo de Empresarios based on the Ministry of Labour, Migration and Social Security, 2021.
Registered unemployment and affiliation, Dec. 2020
Number of people and YoY change Dec./Dec. (%)
Monthly variation in the number of affiliates and
unemployed people
People
Labour market affected by the pandemic
-800000
-600000
-400000
-200000
0
200000
400000
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Affiliates
Unemployed
In December 2020, registered unemployment increased 0.96% compared to November (+36,825), to 3,888,137
unemployed people, 22.9% more year-on-year (724,532 more).
The number of people registered with the Social Security rose 0.04% compared to November (7,350 people),
reaching a total of 19,066,444. Compared to the same month of 2019, there were 360,452 fewer affiliates
(-1.9%).
755,613 people included in the furlough scheme*,
79% fewer than at the end of April.
-5.4
-8
-9.5
-7.8
-6.2
-1.2
22.9
2.6 3.2 3.2 3.5 3 2
-1.9
-12
-8
-4
0
4
8
12
16
20
24
0
2000000
4000000
6000000
8000000
10000000
12000000
14000000
16000000
18000000
20000000
2014 2015 2016 2017 2018 2019 2020
Unemployment (left axis) Affiliates (left axis)
Unemployment change (right axis) Affiliates change (right axis)
Persons %

46. 46
Source: Círculo de Empresarios based on Eurostat, 2021.
Rate of unemployment for those under 25 in Spain and EU
Nov., % of workforce < 25 years
Rate of unemployment in Spain and EU
% of workforce
7.5
8.6
25.9
13.8
16.4
6
8
10
12
14
16
18
20
22
24
26
2007M11
2008M11
2009M11
2010M11
2011M11
2012M11
2013M11
2014M11
2015M11
2016M11
2017M11
2018M11
2019M11
2020M11
EU 27 Spain
15.5
18.5
23
51.8
14.9
30.5
17.7
40.9
0
10
20
30
40
50
60
EU Spain
2007 2014 2019 2020
The relative situation worsens in terms of
unemployment with respect to the EU
In November 2020, Spain registered the worst unemployment figures in Europe, with a rate of 16.4%, more than
double the European average (7.5%). Youth unemployment reached 40.9%, 10.4 pp more than the year before,
exceeding the EU average by 23.2pp.

47. 47
Worsening of the public accounts as a result of the
health and economic crisis
Source: Círculo de Empresarios based on the Treasury Department and the Bank of Spain, 2021.
Budget balance sheet PPAA, Jan.- Sep. 2020
% of GDP
Government deficit
% of GDP
-0.93
-6.52 -6.78
-0.31
-2.12
-1.4
-2.86
-8
-7
-6
-5
-4
-3
-2
-1
0
Q1 Q2 Q3 Q4
2020 2019
-8
-7
-6
-5
-4
-3
-2
-1
0
January
February
March
April
May
June
July
August
September
October
November
December
2020 2019
Up to September 2020, the combined deficit of the Autonomous Communities reached 6.78% of GDP, 5.38 pp
more than the figure registered in the same period of the previous year (-1.4%).
Between January and November 2020, the state accumulated a deficit of €72.3 billion (6.54% of GDP), 6.6
times more than that registered between January and November of 2019 (€10.9 billion, 0.88% of GDP). This
decrease is largely down to the impact of the pandemic, with increased spending by the state (+19.1% year-
on-year) along with a reduction in revenue of 12.7%.
The Bank of Spain forecasts a deficit of between 10.3% and 10.9% of GDP for the year as a whole, reducing
this to between 6.7% and 9.6% in 2021.

48. 48
Public debt increase
Source: Círculo de Empresarios based on the Bank of Spain, 2021.
Public debt
Millions €
Debt by administration levels
Change Feb. – Nov. (%)
According to forecasts by the Bank of Spain, public debt could reach between 116.1% and 117.8% of GDP in 2020
and between 113.7% and 122.8% in 2021.
Between February and November 2020, public debt increased by €110.8 billion as a result of the impact of the crisis
and was above 114% GDP, compared to a figure of 95% prior to the pandemic. The increase in Social Security debt
(55,1%) stands out.
FEB 2020
1,201,768
NOV 2020
1,312,590
1180000
1200000
1220000
1240000
1260000
1280000
1300000
1320000
OCT
2019
NOV
2019
DEC
2019
JAN
2020
FEB
2020
MAR
2020
APR
2020
MAY
2020
JUN
2020
JUL
2020
AUG
2020
SEP
2020
OCT
2020
NOV
2020
+9.2%
9.2
9.8
2
-2.6
55.1
0.3
0.5
1.3
-5.8
33.6
-10 0 10 20 30 40 50 60
Total
Central Government
Regional Autonomies
Local Administrations
Social Security
% change Feb - Nov 2020
% change Feb - Nov 2019

49. Sustained increase in pensions spending
Source: Círculo de Empresarios based on the Ministry of Inclusivity, Social Security and Migration, 2021. 49
Monthly pensions payment amount
Thousands €
Current pensions
Nº
Since 2010, the monthly pensions payroll has increased 46.9%, mainly as a result of revaluation and annual
increases, the increased amount for the new retirement benefits and the increase in the number of pensions in
force (12.%). This number will be exacerbated by an aging population and the retirement of baby boomers.
In 2020, the health crisis caused by the pandemic has mitigated the increase in pensions spending. The number of
pensions grew 0.1% year-on-year until January 1st 2020, 1.06 pp below the average for the past 10 years.
6,867,948
7,883,828
8,881,028
9,759,800
10,087,697
6500000
7000000
7500000
8000000
8500000
9000000
9500000
10000000
10500000
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
01-01-21
+46.9%
8200000
8400000
8600000
8800000
9000000
9200000
9400000
9600000
9800000
10000000
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
01-01-21
+12.3%

50. Businesses increase their debt during the pandemic
Source: Círculo de Empresarios based on the Bank of Spain, 2021.
Non-financial private sector debt, Q3 2019 – Q3 2020
Billions € and % of GDP
50
In Q3 2020, non-financial corporation debt reached €941.309 billion (82.1% of GDP), 4.2% more than at the end
of Q1 2020 (+ €37.710 billion). By comparison, household debt has decreased 0.5% (- €3.534 billion) compared
to Q1 2020 to a total of €701.228 billion (61.2% of GDP).
Consolidated non-financial private
sector debt totaled 143.2% of GDP in
Q3 2020 (€1,642.5 billion), 13.2 pp more
than at the end of Q1 2020. This
increase can be explained by both the
increase in non-financial corporation
debt and the fall in GDP.
In year-on-year terms, the increase of
the consolidated debt was 1.2%,
boosted by the 3.1% growth of non-
financial corporation debt (household
debt decreased by 1.1%).
57.4 56.9 57
60.6 61.2
73.9
72.5 73.1
80.6
82.1
55
60
65
70
75
80
85
600
650
700
750
800
850
900
950
Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020
Households (%GDP) Non-financial corporations (%GDP)
Households (bn€) Non-financial corporations (bn€)
% GDP
bn €

51. 51
*Ex. unprocessed food and energy.
Source: Círculo de Empresarios based on INE and Eurostat, 2021.
Consumer prices index (CPI) fall moderates
Prices development
YoY change (%)
In December, the Harmonized index of
consumer price annual rate was at -0.6%,
two tenths above the rate for October.
In the Eurozone, the fall in prices remained
at 0.3% for the fourth consecutive month in
December.
In Q4 2020, the average CPI variation in
Spain was -0.7% (-0.3% in the Eurozone), with
an average fall in prices of 0.3% (against
+0.3% in the Eurozone) at the end of 2020.
-0.5
0.1
-0.3
-1
0
1
2
3
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
CPI Spain Core CPI Spain* CPI Eurozone
*Ex unprocessed food and energy
In December 2020, the CPI decrease was reduced by 3 tenths to -0.5 year-on-year, compared to an 0.8%
increase in the same month of the previous year. The underlying CPI rate fell 0.1%. The increase in electricity
and fuel prices slowed the CPI fall.

52. Exports
Food, drink and
tobacco
Capital goods
Chemicals
52
Trade balance, Jan. – Nov. 2020
Change with respect to the same period of the previous year
Source: Círculo de Empresarios based on the Ministry of Industry, Commerce and Tourism, 2021.
Downturn in the international trade of goods
Imports
Capital goods
Chemicals
Manufactures
Exports ▼ 10.9% €238,413.7 M
Imports ▼ 15.7% €250,762.8 M
DEFICIT ▼58.7% €-12,349.1 M
Energy déficit ▼ 34.6% (imports of energy goods fell
38.8% and exports 41.5%)
Sector distribution, Jan. – Nov. 2020
% of the total
19.6
19.6
15.7
22.4
18.1
12.7
Goods trade evolution, Jan. – Nov. 2020
YoY change (%)
The fall in international trade and disruption in the global value and supply chains has had a negative effect
on goods exports and imports.
Geographic distribution, Jan. – Nov. 2020
% of the total
-80
-60
-40
-20
0
20
40
60
80
100
-35
-30
-25
-20
-15
-10
-5
0
5
10
15
20
25
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Deficit (right axis) Exports Imports Export Import
Europe 73.2 60.9
EU 60.7 51.6
Germany 11.4 12.4
France 16.2 10.3
Italy 7.9 6.5
Portugal 7.6 3.9
UK 6.5 3.4
America 9.8 10.7
Asia 9.4 21.2
China 3.1 10.7
Africa 6 7
Other 1.6 0.2

53. Slowdown in direct investment flows
53
Source: Círculo de Empresarios based on Datainvex, 2021.
Up until September 2020, received FDI (foreign direct investment) in Spain fell 3.8% year-on-year. For its part,
Spanish foreign investment abroad registered a -56.2% fall. This is within an international context marked by the
Covid-19 pandemic in which the UNCTAD foresees a worldwide decrease in direct investment flows of
between 30% and 40% annually for 2020.
Evolution of FDI flows, Jan. – Sep. 2020
Millions €
-60000000
-50000000
-40000000
-30000000
-20000000
-10000000
0
10000000
20000000
30000000
40000000 2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
FDI in Spain FDI abroad

54. 0
2000000
4000000
6000000
8000000
10000000
12000000
Jan
Feb
Mar
Apr
May
Jun
Jun
Aug
Sep
Oct
Nov
2019
2020
Monthly
0
5000000
10000000
15000000
20000000
25000000
30000000
Jan-Feb
Mar-Jun
1st wave Jul-Aug
Sep-Nov
2nd wave
2019
2020
Accumulated
54
The second wave of Covid-19 slows down tourism again
Source: Círculo de Empresarios based on INE – Frontur, 2021.
Tourist visits in Spain in 2019 and 2020
Nº of people; accumulated and monthly data
Between September and November 2020, Spain received 2.6 million international tourists, 87.6% fewer than in
the same period of 2019. This decrease is in line with that of March-June, after a slight recovery for the sector
during the summer months, which somewhat moderated the rate of decrease (-75.5).
-92,5%
-75,5%
-87,6%

55. Business creation stabilizes but continues to be marked
by decreases
55
Source: Círculo de Empresarios based on INE, 2021.
Between January and November, business creation fell 17.7% in YoY average. The biggest decreases were in April
(-73.4%) and May (-55.9%).
In November, business creation fell 0.7% compared to the previous month, although it increased by 0.1% in
year-on-year terms.
Business formation 2020
YoY and monthly change (%) and number of companies
Business formation, Jan. – Nov. 2020
YoY change (%)
-3.8 -9.2
-28.3
-73.4
-55.9
-9.4 -2.4
7.1 14
-7.9
0.1
-9000
-7000
-5000
-3000
-1000
1000
3000
5000
7000
9000
-100
-80
-60
-40
-20
0
20
40
60
80
100
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
YoY change (%) Monthly change (%)
-27.6 -26.1
2.8
6
3.4
6.8
0.3
-0.1
8.2
-6.5
0.8
-1.6
-17.1
-35
-30
-25
-20
-15
-10
-5
0
5
10
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020

56. Risk premium held in check but with potential risks
56
Source: Círculo de Empresarios based on Bloomberg, 2021
The risk premium fell to around 60 points, thanks to the ECB’s public debt purchasing policy.
Spanish risk premium compared to the German
10-year bond
bps
Rating Spain
2010 – 2020
The main rating firms maintained their rating for Spain, but identified several risks for our economy that could
precipitate downgrades. Among those, the high level of public debt and the delay in the adoption of
structural measures stand out.
50
70
90
110
130
150
170
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Jan-21
Jul-10
Jan-11
Jul-11
Jan-12
Jul-12
Jan-13
Jul-13
Jan-14
Jul-14
Jan-15
Jul-15
Jan-16
Jul-16
Jan-17
Jul-17
Jan-18
Jul-18
Jan-19
Jul-19
Jan-20
Jul-20
Jan-21
Moody´s S&P Fitch
Aaa AAA
AA+
AA
AA-
Aa1
Aa2
Aa3
A+
A
A-
A1
A2
A3
BBB+
BBB
BBB-
Baa1
Baa2
Baa3
Rating

57. 57
Source: Círculo de Empresarios based on Bloomberg, 2021
Uncertainty in the financial markets
Stock market evolution
Jan. 2018=100
Gradual advance of the stock markets in an uncertain environment marked by the third wave of the pandemic
in Europe, the general tightening of movement restrictions, the vaccination campaign and the change of the
US president and policies, among other factors.
50
60
70
80
90
100
110
120
130
140
150
Jan-18
Feb-18
Mar-18
Apr-18
May-18
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Jan-21
S&P 500 Eurostoxx 500 Ibex 35

58. www.circulodeempresarios.org
The Quarterly Report is a publication by the 'Círculo de Empresarios produced by its Department of Economics, which contains information and opinions from reliable sources. The 'Circulo de Empresarios'
does not guarantee its accuracy or take any responsibility for any errors or omissions contained therein. This document is intended for informational purposes only. Therefore, under no circumstances shall
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