These measures should make it possible to minimize the effects of the galloping inflation that the country is experiencing, while the Socialist Party has just suffered an electoral setback.
The Spanish government announced on Saturday a new direct aid plan amounting to nine billion euros to mitigate the economic impact of the conflict in Ukraine on the Spanish population, which is facing soaring inflation. Presenting these measures at a press conference in Madrid, Spanish Prime Minister Pedro Sánchez specified that, added to a first set of measures of six billion euros taken in March, these direct aids would represent until the end of the year a total of 15 billion euros, i.e.more than one point of our country’s GDP“.
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The left-wing government has extended for an additional period of six months, until December 31, the measures adopted at the end of March for three months and whose application was to end on June 30. These measures include a reduction of 20 centimes per liter in fuel prices. But the government has also decideddirect aid of 200 eurosto the self-employed and the unemployed, as well as a new reduction in VAT on electricity, the second in less than a year, from 10% to 5%, a measure that Pedro Sánchez had already unveiled on Wednesday before the Congress of deputies. The executive also decided on a 15% increase in pensions and disability pensions.
Inflation picks up again
Inflation rose again in Spain in May to reach 8.7% over one year, or 0.4 points more than in April, according to an initial estimate by the National Institute of Statistics (INE). This upturn in inflation came after a slight fall had been observed in April (8.3%), raising hopes of the beginning of moderation after a peak of 9.8% year-on-year reached in March, i.e. the level the highest in Spain for 37 years.
“As of today, inflation in Europe is extraordinarily high and, consequently, it is also so in Spain“, said Pedro Sánchez, who claimed that there was “17 European Union countrieswith higher inflation than in Spain. The explosion of inflation, which was aggravated by the consequences of the invasion of Ukraine by Russia, played a big role, according to experts, in the recent decline in popularity of the government of Pedro Sánchez. The Socialist Party he leads suffered a heavy defeat in Sunday’s regional elections in Andalusia (south), which saw the triumph of the Popular Party (PP, conservative opposition).
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“With the measures we adopted three months ago and those we adopted today, the government estimates that we will curb the rise in prices by 3 and a half pointssaid Pedro Sánchez. Among the other measures adopted on Saturday, the head of government also highlighted the reduction by 50% of the cost of monthly subscriptions for the use of public transport depending on the State and by 30% in the case of transport coming under the regions. and local communities.