October 30th, 2006
Spain on the up, Italy on the down
Forgive me, if I indulge in a traditional journalist’s device - namely drawing sweeping conclusions from passing through an airport. But it is hard not to be impressed when you land in Madrid, as I did on Tuesday. The new terminal at Barajas airport opened in February and was awarded the prestigious Sterling architecture prize on October 15th. Its spaciousness, beauty and unhurried feel are particularly striking for anyone who has just arrived from the hell-hole that is Heathrow.
But the contrast that most impresses me is not between Britain and Spain, but between the relative fortunes of Spain and Italy. Madrid’s new airport is a symbol of the confidence and growing prosperity of the country. By comparison, the run-down airport and infrastructure of Rome seem to reflect Italy’s sagging spirits.
The Spanish tell me that within two years, they expect Spain’s GDP-per-capita (measured in purchasing-power-parity) to overtake that of Italy. At the moment Spain’s GDP-per-capita is 98.2 per cent of the EU average, while Italy’s is 100.5 per cent. But Spain grew at 3.5 per cent last year and is expected to rack up 3.1 per cent growth this year. By contrast Italy registered 0 per cent growth last year and is expected to grow by 1.3 per cent this year. Last week Italian government debt was downgraded. Italy’s debt-to-GDP ratio stands at a frightening 106.6 per cent; compare that with Spain’s 43.1 per cent. The Spanish government is running budget surpluses, Italy is struggling with persistent deficits.
It will be a deeply symbolic moment in both countries, if and when it is announced that the average Spaniard is richer than the average Italian. The Italians have always looked down on the Spanish a little bit. (Much as the French have always looked down on the Italians). Italy is a member of the G8; Spain is not. Italy was a leading industrial democracy, when Spain was struck in Francoist isolation. Tourism in Italy was associated with high culture, while Spain had sun, sea and sangria. But these days it is Spain which is growing fastest and which is exhibiting a new cultural confidence. The Spanish film director Pedro Almodovar is globally celebrated - much as the Italian director, Fellini, was in the 1960s and 1970s. It is Spain that is full of exciting new architecture from Madrid airport to the Guggenheim in Bilbao.
What accounts for the difference between Spanish and Italian fortunes? A blog entry is perhaps not the place to attempt a full-scale analysis. But three things strike me. First, Spain has had very few governments compared to Italy’s fragile and revolving coalition. The Spanish governments of Gonzalez, Aznar and now Zapatero have had time to put sound policies in place and see them through to fruition. Second, the Spanish welfare state is much less generous than Italy’s - and organised labour is weaker, as is the extreme left. Finally, the magic ingredient - confidence. Spain has bags of it at the moment. Italy seems gloomy and fearful by contrast.










