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Transcript of SPAIN
Trade Agreements, Organizations & Barriers
Culture & Customs
Situated in Southwestern Europe, just north of Africa, surrounded by the Atlantic Ocean on the western side and the Mediterranean on the southern side.
Europe's 4th largest country
19 Autonomous Regions which are further divided into 50 provinces
Native Spaniards make up 88% of the total population of Spain.
Spaniards spoken mother tongue: Spanish (89%), followed by Catalan (9%) Galician (5%), Basque (0.9%), Other (3%)
mainland Spain is a mountainous area
several major rivers such as the Tagus, Ebro, Guadiana, etc.
2 archipelagos: Balearic Islands & the Canary Islands
Mediterranean (east/central): warm and dry summers, extreme heat/cold in respective seasons
Semi-arid (south-east)/central: dry season extends beyond the summer
Oceanic (north): season influenced by ocean
Imports and Exports:
Spain has a high income mixed economy, like the US and other developed countries. This means that while much of the economy's output is produced and distributed via the market mechanism, the government takes a substantial role in the economy through tax and spending decisions.
since the financial crisis of 2007–08 involving the collapse of the construction industry and housing bubble crash , the Spanish economy's recent macroeconomic performance has been poor. Between 2008 and 2012, the economic boom of the 2000s was reversed, leaving over a quarter of Spain's workforce unemployed by 2012. In 2012, the Spanish economy contracted by 1.4% and was in recession until Q3 of 2013
the first quarter of 2014, Spain experienced its largest GDP increase since the 2008 recession. However, debt rose to over 90 percent of GDP in 2013. Spain’s unemployment rate has declined slightly to about 25 percent, and youth unemployment hovers around 55 percent.
twelfth-largest exporter in the world (2012) & sixteenth-largest importer in the world (2012), trade makes up more than half Spain's GDP
had a trade deficit persistently over the past few years, which stood at $77.5 billion in 2009 attributed to several factors, predominantly the nation’s increasing reliance on imported petrol and decreased market competitiveness. Additionally, the steady decline of Spain exports is also attributed to the strength of the euro, since it was adopted by Spain for international trade, which has made Spanish exports more expensive.
commodities: motor vehicles, olive oil, red wine, medicines, machinery and pharmaceuticals
*During 2009, Spain had net earnings of $215.7 billion from its exports. This represented a decline of $70.2 billion from the export earnings of 2008.
commodities: oil, petrol, mechanical and electric machinery, iron and steel
*During 2009, Spain's imports were valued at $293.2 billion, which was a considerable decline from the 2008 level of $415.5 billion.
The reason for such a wide gap between Spain’s exports and imports is the lack of resources in the nation
, particularly oil. The nation imports a size-able 1.813 million barrels of oil per day.
Major Trading Partners
Spain’s trade policy is similar to that of other nations of the
. Import tariffs do not apply within EU-member states. The common weighted average tariff rate in the EU was 1.3% in 2008. The EU, however, has higher tariffs for manufacturing and agricultural products. The EU and Spanish trade policy also has several non-tariff barriers, particularly in the primary and secondary sectors, such as: subsidies and quotas, import restrictions or bans on shipment of certain goods, and market access restrictions in certain services sectors. Since 1995, Spain has been a member of the
World Trade Organization
, who's purpose is to help trade flow as freely as possible for economic development and well-being.
been a constitutional monarchy with a parliamentary form of government since 1975
current constitution, which allows for democratic elections of members of the Spanish parliament, was adopted in 1978
Prior to the establishment of the current form of government, Spain had been under a military dictatorship led by General Francisco Franco since 1936
Current King of Spain aka
Head of State
, ascended to throne 19 June 2014, he appoints the prime ministers and summons and dissolves the Parliament, among other responsibilities
Current President of Government aka
Mariano Rajoy Brey
, elected 20 November 2011 + his Cabinet
Spain's political system is a
, but since the 1990s, 2 dominant parties in politics: the Spanish Socialist Workers' Party (PSOE) and the People's Party (PP)
Spain is organizationally structured as a Estado de las Autonomías ("State of Autonomies"); it is one of the most decentralized countries in Europe, meaning all Autonomous Communities have their own elected parliaments, governments, public administrations, budgets, and resources.
in Spain has grown to become the second largest in the world in terms of spending, worth approximately 40 billion Euros or about 5% of GDP in 2006
One of the leading countries in the development and production of
energy: wind, solar, hydroelectric, biomass and marine
Business Practices (Do's and Taboo's)
Problems & Risks of doing Business in Spain
expect English to be widely spoken
get straight to business (charisma and personality over a degree)
backslap/hug in the initial phase of a business relationship
be late (over 40min, reschedule)
use Spain's historic ties with many countries in the World that were once under her control to your advantage.
take into account their laid back lifestyle: food, drink, dancing and music
treat EVERYBODY in a Spanish company with the utmost respect. Their organizational chart is social, not functional. The third or fourth level down may be more powerful than those at the top.
emphasize trust and honesty
shake hands with everyone
currently have a very bad trade deficit
exports are scare and expensive due to the strength of the euro
increasingly competitive environment
division of the country into 50 provinces keeps the Spanish people culturally separated and independent, such cultural diversity within one country can be challenging for foreigners who do not understand how culture impacts business throughout the country
Spaniards try to avoid ambiguity and need as much detail as possible, patience is required
businesses related to or associated with property will likely not succeed
All Spanish towns and cities have their own special celebrations filled with parties, parades, fireworks, etc.
a controversial yet traditional spectacle of Spain in which one or more bull is fought in a bullring
since the ancient days, as early as 1726
St. Fermin Festival + Running of the Bulls in Pamplona:
every July, hundreds of thousands of spectators and participants attend for the bull-running that takes place every day for a week
La Tomatina, Buñol:
held every August in Buñol in Valencia, which culminates in a huge tomato fight involving 30,000 people and 40 tons of ripe fruit. Begins with adventurers trying to scale a slippery soap-covered pole to reach a dangling ham as they get pelted with water and tomatoes from rowdy onlookers
Semana Santa (Easter) and April's Fair in Seville:
biggest festival, celebrated all over Spain, beginning on Palm Sunday and lasting through Easter Sunday filled with Catholic mass and street parties
: a musical style, more emphasis on the guitar, vocals and rhythm than the dancing. In fact, the whole idea of flamenco dancing is for it occur spontaneously
: Spaniards, drinkers of wine, party often and very late (never before 10pm), especially in Madrid
small dishes of snacks which are served anytime especially in small bars, ranging from seafood to vegetables, many Spanish people make an evening of hopping from bar to bar trying different tapas.
takes on an quasi-religious significance in the lives of Spanish males from the age of five to 100, home to 2 of the most successful teams in European soccer (Real Madrid & Barcelona)
very important in Spain within every region
: designated resting time, for shops and businesses is from approximately 2pm until 5pm while bars and restaurants close from about 4pm until about 8 or 9pm.
Popular Events & Traditions
Working Facilities & Conditions
Compared to the rest of the EU, the Spanish labor market is one of the lowest-paying and precarious. Over 35% of the work-force is on temporary contracts which are often low-paying and can be canceled unilaterally any time by employers. Today, with unemployment at 16%, it is one of the highest in the industrialized world.
The Spanish government permits temporary contracts, opening space for private companies (agencies) to place temporary workers, low-paying apprenticeship contracts, scrapping concepts such as extra pay for overtime work or a 40-hour work week, decreasing severance costs, and allowing employers to move workers between different functions and geographic locations
With unemployment at 16 percent today, it is one of the highest in the industrialized world. The reasons behind the high unemployment rate are the decline in agricultural employment, inadequate skills of the labor force, small companies' difficulties in an increasingly competitive environment, and previously high inflation. Some economists estimate that the black market actually employs some 10 percent of the active population, mostly younger workers with few qualifications to enter the regular labor market.
The presence of women in the Spanish labor market is below European average even after increases in the 1980s and the 1990s. Despite legislation, inequalities remain; women's unemployment in 1996 was 30.4 percent and women's work contracts tend to be either part-time or temporary. An average woman earns 72% of the average man, and women are underrepresented in the higher status occupations with the exception of scientists.