Re-industrialization, remote work, and the return of tourism

Re-industrialization, remote work, and the return of tourism

BarcelonaThe pandemic has changed the economy forever, but on a geopolitical scale more than the daily lives of citizens. Remote work has strengthened, but it is not the majority, and tourism remains an engine of growth. In contrast, the European Union and the United States made fundamental changes to enhance their production capabilities.

Work electronically

It's mild, but it's also enhancing

The COVID-19 outbreak and lockdowns represent a sudden boost to a trend that had already begun, at a slower pace, years earlier: remote work from home. Remote working reached its maximum in 2020, when 10.6% of Spanish workers worked from home, according to data from Eurostat, the European statistics agency. As activity returns to normal and restrictions are gradually eased, the numbers have fallen slightly to 7.6% in the case of Spain in 2022. Despite the decline, the data are higher than before the pandemic, when they never reached 5%. .

The type of production fabric and cultural and climatic factors mean that Spain is well below the levels of remote working in Central and Northern European countries – Ireland and Finland exceed 20% of remote workers – where the weather is cooler and there are more high-value workers. – Additional jobs that can be done from home, in sectors such as IT, communications, finance or design. In fact, this boom in remote work in the Old North (and in other countries, such as the United States) also explains the increase in the number of remote workers.Expatriates (foreigners working in well-paid jobs) who have moved to Barcelona in recent years, with consequent upward pressure on house prices.

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European funds

The European Union is taking another step to unify its economy

The pandemic has highlighted the need for many companies to go digital. This fact, combined with the growing urgency to deal with climate change, has prompted EU countries to create Next Generation Funds. It is designed to promote digital transformation, technological innovation and sustainability in the European productive fabric, especially in the southern countries most affected by the pandemic.

In total, Spain should receive the huge sum of €163,000 million in six years, almost half of which is lost money (the rest is low-interest loans that the country must repay), and 12% of its gross domestic product (GDP). Last year, according to data from the Spanish government, it published calls for aid worth $2,000 million, on average, every month.

The creation of Next Generation is another step for the integration of the EU economy, because it represents a transfer of funds for investments from the richest countries to the poorest with the aim of improving their productivity and, consequently, their competitiveness.

tourism

Model change nothing

After 2020 and 2021 with tourism largely halted due to restrictions and a spike in infection rates, the Catalan and Spanish economies led the coronavirus-induced economic crisis in Europe, and thus the tail end of the recovery. A debate between economists, experts and departments For two years I focused on changing the production model of abandoning tourism – which represents about 18% of economic activity in Catalonia – and betting on sectors with high added value, such as research, technology and communications. In the summer of 2022, already without restrictions, tourism rose again and it became clear last year that changing the paradigm was just wet paper: in 2023, it represented a new record for tourists in Catalonia, with 18 million foreign visitors.

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Good tourism data is one of the reasons – along with low inflation – why the Spanish economy is growing at a higher rate than the rest of Europe. The good news is the increase in tourism spending, which last year also broke historical records with more than 20.8 billion euros, 26% more than in 2022.

recycle

Europe and the United States want to achieve self-sufficiency

The pandemic put a reality on the table for the most advanced economies: from an industrial point of view, they were not self-sufficient. With the outbreak of the epidemic, the European Union, the United States, and other rich countries such as Canada and Australia found themselves without the ability to produce the materials and machinery needed to equip hospitals. All types of health equipment, such as masks and respirators, were produced in factories located in emerging countries – primarily China and Southeast Asia – thousands of kilometers away.

In addition, in 2022, when Europe and the United States abandoned restrictions, the production capacity of China and emerging countries was not sufficient. Bottlenecks occurred In logistics chains and shortages of industrial components. The coronavirus eradication policy implemented by the Chinese government in the first months of 2022 has made the situation worse.

The shift to the third level in advanced economies over the past decades has meant a weakness that has geopolitical implications, with the world's most democratic countries becoming increasingly dependent on Beijing and other capitals that do not like human rights. This weakness was confirmed again towards the end of the pandemic, when the Russian invasion of Ukraine highlighted Europe's strong dependence on gas supplied by Vladimir Putin's regime.

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Faced with this situation, the European Union, the United Kingdom and the United States have taken policies to encourage the relocation of factories to their territories, or, as the least evil, to countries as close as possible and with as little diplomatic tension as possible. There is no doubt that disputes between China and Taiwan would increase the West's tendency to reindustrialize.

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