MercoPress. South Atlantic News Agency

Immigrants' contribution to Spanish boom

Immigration in Spain which jumped fourfold in the last six years is responsible for half the economic growth of the country in the last decade helping to reduce unemployment and improve revenues.

According to an official report released in Madrid this week, "Immigration and the Spanish economy: 1996-2006", in the last ten years, between 30 and 50% of Spain's economy growth can be tracked to immigrants. The first percentage figure corresponds to the first half of the decade and the second to the last five years.

The report was done by Miguel Sebastián the chief economic advisor of the current Socialist government headed by President Jose Luis Rodriguez Zapatero

"Whoever believes that the Spanish economy does not have much more space, does not understand the migratory phenomenon. The Spanish economy has ample margin to keep expanding", said Sebastián adding that Spain has sufficient instruments "for an economic forward leap unprecedented in history".

Sebastián's report follows on a previous one released last August by the Caixa Cataluña, Catalonia's main financial institution which argues that immigration has become not only the engine for Spain's economy, but also for the whole of Europe.

Spain receives annually an estimated 200.000 immigrants.

The Caixa Catalonia report shows that the Spanish economy expanded an average 2.6% annually during the last decade mainly because of immigrants' contribution. If this had not been the case Spain's GDP "would have dropped 0.6% between 1995 and 2005", argues the report, which also points out that similar numbers can be applied to the rest of the continent. Only Ireland, Finland and France would have experienced GDP growth without the support from immigration.

Sebastián's report describes immigration's contribution to the Spanish economy as "clearly positive". The Spanish economy has been growing uninterruptedly for over a decade. Besides Spain's four million immigrants, equivalent to 8% of the population, generate tax revenue estimated in 23 billion Euros annually, which is 6.6% of total government revenue.

The report also shows that immigrants from Argentina, Morocco, Ecuador, Colombia and Rumania on average have a higher education level than the locals, most of which have settled in east Spain and Madrid.

Of the 2.6 million jobs created between 2001 and 2005, 1.3 million were occupied by immigrants helping to increase 30% the gender participation.

Sebastián said that even when immigrants contribute to the Spanish treasury less than their population percentage, they also receive fewer services and therefore "at the end of the day the result is most positive and will continue to be in the short and medium term".

"Things will begin to change towards 2030", when immigrants reach the retiring age.

This is timidly showing in less labor productivity, mainly because of the lack of a solid formation among young immigrants; the drop in salaries since they are paid on average 30% less than Spaniards, and the deficit generated by the remittances sent back home to the different countries.

The latest figures from the Bank of Spain indicate that remittances overseas from immigrants in Spain jumped 36% in the first seven months of 2006, totaling 3.35 billion Euros.