Balearic Islands expects to close 2024 with a surplus of 0.6% of GDP, according to the latest estimates published by the Fundación de Estudios de Economía Aplicada (Fedea) in its Observatorio Fiscal y Financiero de las Comunidades Autónomas (Fiscal and Financial Observatory of the Autonomous Communities). This result places the islands among the five communities which, together with Asturias (1.2%), the Canary Islands (0.9%), Navarre (0.7%) and Cantabria (0.7%), will end the year in positive numbers, according to the report prepared by José Ignacio Conde-Ruiz, Manuel Díaz and Carmen Marín. On the contrary, nine other autonomous communities, among them Comunidad Valenciana, Murcia, Cataluña and Madrid, will lead the list of those with deficits in their 2024 budgets. Specifically, the Valencian Community and Murcia will record the highest deficits, of -1.8% and -1.6% of GDP, respectively.
A generalized deficit despite the increase in resources
Fedea warns in its report that, despite the fact that the autonomous communities have received this year more than 20,000 million additional Euros from the Autonomous Financing System (SFA) with respect to 2023, it is expected that the regions as a whole will close 2024 with a deficit of 0.4% of GDP. This figure contrasts with the Government’s budget balance forecast and exceeds the estimates of the Independent Authority for Fiscal Responsibility (AIRef), which calculated a deficit of 0.3%. “This figure would be a warning sign, especially given the injection of additional resources this year, and could jeopardize the deficit reduction targets announced by the Government for 2024,” notes Fedea in its report, emphasizing the urgency of fiscal consolidation involving the autonomous communities.
Balearic Islands and the fiscal commitment for 2025
The report also puts the focus on next year, when the European Union’ s new fiscal rules will require an additional commitment to fiscal consolidation for Spain, with the aim of stabilizing the public deficit. According to Fedea, the collaboration of the autonomous communities will be key, given that they represent a large part of public consumption in the country.
