MADRID - Spain's gross domestic product shrank by 0.3 percent in the first quarter after contracting at the same rate in the final three months of 2011, confirming a return to recession, according to final statistics published Thursday.
The figures confirm preliminary data issued in April by the National Statistics Institute (INE), underscoring the precarious state of the eurozone's fourth biggest economy, which is battling a record high 24.4 percent unemployment rate.
An INE statement said that weaker domestic demand, including household consumption and public spending, had undermined growth as Spain struggles with austerity measures aimed at cleaning up its finances.
Spanish exports and its tourism sector have not been able to make up the difference, owing to a generally weaker economic climate elsewhere in Europe.
Spanish growth had depended to a large extent on the construction sector, which went into a slump in 2008, and the country's last recession lasted until early 2010.
Spanish officials acknowledge that the economy is going through one of its toughest ever moments, but have voiced optimism for the future.
Economy Minister Luis de Guindos has estimated that gross domestic product will shrink by 1.7 percent this year, but forecasts slight growth of 0.2 percent in 2013.
The national foundation of savings banks, Funcas, is less optimistic, and estimates that the recession will last until the second half of 2013.
Analysts at Commerzbank expect Spain to be the only eurozone country still in recession next year, with a drop in GDP of 0.3 percent.
source: interaksyon.com
