Abstract
In 2007 the Spanish economy showed a large current account deficit (10 per cent of GDP), a public budget surplus (2.2 per cent of GDP), and a relatively low household saving rate (6.5 per cent of GDP), at least when compared with its investment rate (almost 10 per cent of GDP). However, with the economic crisis of 2008–9, the situation changed dramatically, as Figures 6.1, 6.2 and 6.3 show. The public budget surplus turned into a huge deficit, estimated at 11.2 per cent of GDP in 2009, the household saving rate increased enormously, to above 11 per cent of GDP, and the current account deficit, at 5.0 per cent of GDP in 2009, was correcting very quickly.1
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