Economy - overview:
Spain's mixed capitalist economy supports a GDP that on a per capita basis approaches that of the largest West European economies. However, after a decade of economic growth that exceeded the euro-zone average, the Spanish economy is in the midst of a sharp and prolonged recession, marked by swelling unemployment and a significant increase in the government budget deficit. Spain's unemployment rate rose from 11% in 2008 to almost 20% in 2009, and its fiscal balance deteriorated from a deficit of 3.8% of GDP in 2008 to over 10% of GDP in 2009, more than three times the euro-zone limit. The pace of GDP growth fell significantly. In 2009 GPD per capita is shrank 3.8% from 2008, ending a 16-year growth trend. The reversal in Spain's economic growth reflects a significant decline in the construction sector, falling consumer spending, and slumping exports. Government efforts to boost the economy through stimulus spending, tax breaks, and loan guarantees have not reduced the unemployment rate, which was one of the highest in the EU in 2009. The Socialist president, Jose Luis Rodriguez ZAPATERO, in office since 2004, has made mixed progress in carrying out key structural reforms, such as revamping Spain's construction-led economic growth model and enacting politically difficult reforms to the labor market. Spain's banking sector has been relatively insulated from the global financial crisis, due in part to conservative oversight by the Bank of Spain. Government intervention to rescue banks on the scale seen elsewhere in Europe in 2008 and 2009 was not necessary in Spain, although Spanish banks' high exposure to the collapsed domestic real estate market poses continued risks for the sector.

GDP (purchasing power parity):
$1.367 trillion (2009 est.)