Navarra economic growth projected to slow to 1.7% by 2027

Laboral Kutxa forecasts a deceleration in the economy of Navarra, projecting a GDP growth of 1.9% for this year. While this remains above the European average, it is lower than Spain's projected growth of 2.4%.

Looking further ahead, the institution predicts growth will slow to 1.7% by 2027, compared to a projected 1.9% for Spain in the same period. Joseba Madariaga, Director of Studies at Laboral Kutxa, attributed this slowdown to a loss of economic supports and geopolitical volatility.

The services sector remains the primary driver of growth, though industrial performance has been mixed. Specifically, the capital goods industry has struggled to gain momentum, and gains in the automotive sector due to electric vehicle production have not been sufficient to offset losses in other industrial areas.

Regarding the labor market, the unemployment rate is expected to decrease from a projected 8.3% this year to 8.1% by 2027. Inflation is also expected to moderate, potentially dropping from 3.1% this year to 2.4% next year.