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July 8th, 2014 – Article previously published in ‘El Confidencial Digital’.

Consumer confidence advances for better perception of the economic situation.

Positive data from the Spanish economy are reflected in the mood of the Spaniards, even Wisely: Consumer confidence advances for better perception of the economic situation. According to the Center for Sociological Research CIS, the consumer confidence index (CCI) stood at 84.9 points in May, 2.9 points above the figure for the previous month due to an increase of 6 points in the evaluation of the current situation. As was the case in April, with a further increase, confidence returned to values ​​not seen since mid-2007, although the expectations index has had a slight decrease of 0.1 points. Compared to the same month last year, progress continues to be very significant; increased consumer confidence index, reached 34.1 points, with very similar gains in absolute terms for the assessment of the current situation (36.4) and expectations (31.8).

And, although credit to households has dropped 5.3% and lending to companies fell almost 10%, in both cases so far this year, but increase the credit called “new” or “solvent”, the having assurances that will be returned to the financial institution that lends it-the measures taken in early June by the European Central Bank raise hopes that finally the tap of credit to households and SMEs are open: the liquidity amounting to 400,000 million euros, as well as reduced interest rates to 0.15% (record low) should help achieve this objective.

The improved economic outlook could lead to an increase in consumption, the government, with the leading indicators of activity, a figure in the first half of the year by 3%: between 2009 and 2013 the Spanish families reduced on average consumption by 14.5%, or to pay down debt, as indicated by the Bank of Spain, either for lack of purchasing power or to save for the future. Yes, for the first time six years ago, the European Consumer Centre 2014 Cetelem detected in the first six months of the year improves mood of the Spaniards: this improvement makes 33% of Spaniards (26% in 2013) consider increasing their spending in the next 12 months. This percentage is, however, below the European average, 40% (33% last year). 38% of Spaniards think increase your savings in the same period. It is the same percentage as in 2013 and one point above the European average (37% versus 39%, 2013), showing an attitude of caution, especially in the short term.

46% of purchase intent in the next 12 months focusing on leisure and travel; 32% in smartphones, and 18% on a new car (15% used). For the next three months, continue to gain leisure and travel (24.6%), and information technology accounts for 3.4%, the new car only 3.2% and equipment, 2.2%.

E-fair trade when the sales season starts, could be a good incentive for increased consumption in the coming months: 54% of Spaniards have acknowledged that Internet shopping during the sales period, a percentage that has increased by 10 points from 2013 (44%) and that makes Spain the European country with the highest growth in this sector, according to a study by Sarenza.

The main reasons for consumers to opt for the ‘e-commerce’ are availability, the easy access, speed, competitiveness, personal attention and safety, payment methods. El Corte Ingles, the main large distribution company in Spain, years ago and it became the stronghold of electronic commerce in all product categories, in our country, and in the last two years has made the leap to Europe through its online sales platforms, threatening to traditional American Internet giants like Amazon, who are not used to the behavior patterns of European consumers. The English Court, with many decades of knowledge of consumers in shopping malls, can adapt more easily to the desires of a consumer who already know and at the same time, is very familiar with your brand.

Tax reform recently announced by the Government, which will save taxpayers to EUR 9,000 million over 2015 and 2016, especially among lower income could be an incentive for economic activity. The government wary of deficit reduction, despite the tax cuts, increased revenue in two ways: more economic activity and more effectively in the fight against tax fraud. Tax reform would have a direct positive effect on GDP of 0.5%.

International investors see Spain as an attractive place to invest: according to the World Investment Report submitted in June by the United Nations, Spain became in 2013 the ninth country in the world to receive FDI amounting to 29,000 million euros, . 52% more than in 2012 trend strengthened in 2014, also increasing investment this year: in the first six months of the year, foreign direct investment in Spanish companies totaled 26,800 million euros. Institutional investors and large private investors George Soros, Bill Gates, among others, trusting in the economic recovery and the assets of our companies have decided to devote resources to companies in various sectors, be Prosegur FCC safety or construction.

Some positive effects are being felt: as the CBSO Bank of Spain (June data), non-financial companies increased profits by 49.3% during the first quarter, and large Spanish companies again recruit staff with the tractor effect it poses to the ecosystem of SMEs, providers who have business dealings with them.