Research Paper: Country Analysis

I would like to discuss in this paper Spain and analyze all information about this country with more details. The main aim of this research paper is to analyze country’s growth history and to think about its growth prospects. It is necessary to pay special attention on economic data about this country and on strategies of its development, because it is an important component of country’s prosperity in our contemporary changing conditions.
Description of the country
Spain is the tenth country in the industry development. The country is located in the European region. And while Europe – the continent is not as strongly articulated the western part of the largest continent of the Earth – Eurasia, it used to be considered in isolation. This is due to historical, cultural and economic features, the outstanding role of the European region for many centuries.
Europe – is the center of Western civilization. From there it spread, “continued” on the other continents of the Earth – North America, Australia, in part, and South America. The modern American political scientist Samuel Huntington pointed out that the most important overseas division in Europe can serve as the eastern boundary. This line runs along the present border between Finland and Russia, among the Baltic States and Russia, cuts through Belarus and Ukraine, is to the west, separating Transylvania from the rest of Romania, and then – through Yugoslavia almost exactly along the line that separates the current Croatia and Slovenia from the rest of Yugoslavia. In the Balkans this line coincides with the historic boundary between the Hapsburg and Ottoman empires. In such a way we can mention that the world-famous “sacred stones of Europe” attract millions of tourists from all over the world. Not by accident the first three places in world tourism occupy – Spain, France and Italy. And exactly Spain is the country that will be discussed in our paper with more details.
Geographical position
Saying about Spain’s geographical position it is necessary to mention that high mountains – the Pyrenees peninsula separated Spain from the rest of Europe. By Dividing Range is the northern land border of the country, here it borders with France and microstate Andorra, in the west – with Portugal, in the south-east to Gibraltar – we can find British possessions on the shores of the Gibraltar Strait. Sea borders occupy more than half the length of the country’s borders. Most important units of Spain’s position between Europe and North Africa, the Mediterranean and the Atlantic have always played a big role in its history. It was the Spaniards made many great discoveries.
In present times, the Iberian Peninsula connected shortest sea and air routes to America. In the south is Cape Morocco – extreme southern point of Europe. Strait of Gibraltar, which is of great importance to shipping, separates the Iberian Peninsula from Africa. With respect to the center of Europe, Spain, the situation looks like a peripheral that hindered its development in some historical periods. And now the country is the EU’s periphery. Major port and industrial cities are in the north and the north-east on the sidelines of the major centers of Europe and the world’s sea lanes. The proximity to North Africa and the Middle East with its huge oil and gas resources has helped to create major maritime industrial complexes in the south of the country based on imported fuel.
It is good that Spain is located south-west of polluting industrial centers of Europe, so the western air transport rescues the country from the “import” of transboundary pollution.
Economic situation in the country
According to www.nationsencyclopedia.com we see that “after 1939, Spanish economic policy was characterized by the attempt to achieve economic self-sufficiency. This policy, largely imposed by Spain’s position during World War II and the isolation to which Spain was subjected in the decade following 1945, was also favored by many Spanish political and business leaders. In 1959, following two decades of little or no overall growth, the Spanish government, acceding to reforms suggested by the International Monetary Fund (IMF), OECD, and IBRD and encouraged by the promise of foreign financial assistance, announced its acceptance of the so-called Stabilization Plan, intended to curb domestic inflation and adverse foreign payment balances.” And in continuation of this topic we should quote Rinehart & Seeley words, who said that “Long-range planning began with Spain’s first four-year development plan (1964–67), providing a total investment of P 355 billion. The second four-year plan (1968–71) called for an investment of P 553 billion, with an average annual growth of 5.5% in GNP. The third plan (1972–75) called for investments of P 871 billion; drastic readjustments had to be made in 1975 to compensate for an economic slump brought on by increased petroleum costs, a tourist slowdown, and a surge in imports. A fifth plan (1976–79) focused on development of energy resources, with investments to increase annually by 9% increments. A stabilization program introduced in 1977 included devaluation of the peseta and tightening of monetary policy. The economic plan of 1979–82 committed Spain to a market economy and rejected protectionism.” (Rinehart, Robert & Seeley, 1998)
Discussing historical background of Spain in the area of economic development it is necessary to mention that at the beginning of 1970th Spain entered in the group of leading countries in the world, it became the 10th industrial power in the world. GDP volume – was 850.7 billion of dollars. At PPP (2003), per capita – $ 21200 and share-tenth of the population with the highest income is 25,2%. Monetary unit is the euro.
Spain – is an industrialized country, which is important agricultural and non-production sphere. In 2002, Spain received more than 51 million tourists. 95% of tourists were from the EU countries (France, Germany, Italy, and England). Revenues from tourism – consisted of 11% of GDP (2003).
The economic growth rate, for example, in 1995 to 2003 was rather good, because average annual GDP growth amounted to 2,6% (3,7% in 2003). The decisive factor of economic growth – is domestic demand (up 4.5% annually). The strategic objective of economic policy – is further liberalization, privatization, and deregulation of the economy in order to better respond to the economic structure of the EU, the development of small and medium businesses, research and development, modernization and streamlining of management structures.
In 1991-2003 a budgetary deficit grew short from 7,1% to 1,6% GDP. Budgetary profits were made by 10,5 milliards of dollars.(2003). The policy of reformation of the tax system proceeded on regional and local levels.
A monetary policy provided financial stability (inflation rates grew short from 11,4% in 1991 to 3,0% in 2003) and co-ordination of economic policy in strict accordance with tasks and priorities of economic policy. A loan long-term percent fallen down from 10% in 1993 to 4,2% in 2003. Priorities of social policy are providing of employment, further reformation of the system of education, health protection, pension system, labor legislation, development of social dialog. An unemployment rate went down, though remains the highest in the EU.
In acknowledgement of this information I would like to present the next quotation: “After an economic downturn in the early and mid-1990s, the Spanish economy turned around to register a new dynamism characterized by strong growth rates and a rise in foreign investment sparked by increased liberalization. Moreover, unemployment dropped and inflation remained in check. Spain capped its success by entering the European Monetary Union (EMU) in 1999. Reducing the public sector deficit, decreasing unemployment, reforming labor laws and investment regulations, lowering inflation, and raising per capita gross domestic product (GDP) were all goals in the early 2000s. Economic growth was forecast at 1.8% in 2003, the highest of all the large EU economies. The construction sector was thriving in 2002, driven by higher levels of investment and public infrastructure projects.” (Burke, 2008)