círculo de empresarios - quarterly report on the global and ......quarterly report on the global...

Quarterly reporton the global and the

Spanish economyQ2 2016

Círculo de EmpresariosMadrid, July 2016

2

ENTORNO GLOBAL

2016 GDP projections

3*World Bank forecast, June 2016Source: Círculo de Empresarios based on European Commission Spring forecasts, 2016

2.3%

UEM

1.6%

-3.7%

2.2%

-0.5%0.6%

0.8%

6.5%China

India

7.4%

4.9%

Russ

ia

-1.9%

1.8%

0,8%

GLOBAL GDP*2015 2016

2.4 2.4

Risks to global growth...

4

1 • Economic and financial shocks• Possible spillover effects• UE cohesion at risk

BREXIT

• Weak global trade• Brazil’s political crisis• Less income due to lower commodity prices

CHINA + EMERGING

• Geopolitical conflicts and human crisis• Middle East• Terrorism

GEOPOLITICAL INSTABILITY

• Monetary policy divergence• Space for further accommodation has narrowed• Dolar appreciation

MONETARY POLICY

• Negative interests rates in Japan and EU• An increase in global risk aversión • Higher financial volatility

FINANCIAL MARKETS

2

3

4

54

Improvement in the global scenario

5

¥

Rebound in oil pricesChina’s soft landing

...However, rising uncertainty mainly driven by Brexit

++ +GDP growth faster thanexpected in Japan, EU, US... (+80% since February)

Less pressure on the value of theyuan, and the pace of decline

of currency reserves slowed

Large losses in European Stock Markets

(-11% Europe, on June 24th)

Market volatility increases

(+50% VIX*)* VIX: Volatility Index

Anemic economic activity...

6

Slowdown in economic activity

Emerging economies contributedto 50% global growth downgrades

Global manufacturing PMI pointsto 2012 minimums

Global trade forecasts continued to be downgraded due to:

Marked deceleration in importdemand for emerging economies

Rebalancing in China

Crisis minimums

2.3 2.4 2.6 2.4 2.4

1.31.1

1.7 1.8 1.7

54.7

4.2

3.4 3.5

0

1

2

3

4

5

6

2012 2013 2014 2015 2016 2017 2018

Real GDP GrowthAnnual change

Global Advanced Emerging

Forecast

0

3

6

9

12

15

2010 2011 2012 2013 2014 2015 2016

Global trade evolutionAnnual change

í -3

0

3

6

9

12

15

Global Emerging Advanced

Import volume growthAnnual change

20112015

Source: Círculo de Empresarios based on World Bank, 2016

Emerging: weak recovery

Half of the pre-crisis average growth rate

Emerging economiesaccount for about 50% of global growth comparedto more tan 60% in 2010-14

90% of growth slowdownwere in commodityexporters (especially crudeexporters)

7

...Especially in exporting emerging economies

Divergence among emerging economies

Fifth consecutive year of decling growth

*Slowest pace since the financial crisis

+7.1%South Asia

+6.3%East Asia and Pacific Middle East + North Africa

+2.9%

Sub-SaharanAfrica Europe and Central Asia

+2.5% +1.2% -1.3%Latin America and the Caribbean

3.2

2.1

0.2 0.4

5.9 5.9 5.9 5.8

4.74.2

3.4 3.5

0

1

2

3

4

5

6

7

2013 2014 2015 2016

Emerging countries' real GDP evolution%

Commodity exporters

Emerging (excludingcommodity exporters)

Total emerging

Source: Círculo de Empresarios based on The World Bank, June 2016

25

35

45

55

65

2000 2004 2008 2012 2016 2020

Share of emerging vs advanced countries% of global GDP

Advanced economies

Developing economies

Source: Círculo de Empresarios based on IMF, April 2016

Emerging: share of global GDP

8

In 2016, emerging economies represents 58.1% of global GDP and 85% of world population

From 2010-15, BRICS accounted for about 40% of global growth, up from about 10% during the 1990s. Actually, they together now account for more than 20% of global activity

58.1%

41.9%

(PPP)

Emerging: external sector and reserves

9

Weak exports, especially in dependent commodity-exporting countries(Brazil, Russia...)

... However, foreign exchange reserves are broadly stable

Outflows in emerging economiesIn million $

EmergingOutflows

2014-111.000

2015*-735.000

2016**-448.000

*92 % in China** IIF forecast

-2

0

2

4

6

8

10

12

2011 2012 2013 2014 2015 2016

Exports of goods and servicesAnnual change

Emerging countries Asia Global


-1

-0,5

0

0,5

1

1,5

2

2,5

3

3,5

4

-300-200-100

0100200300400500600700800

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Current account in emerging economies

Millions (left axis)

% GDP (right axis)


0 5 10 15 20 25 30 35 40

Thailand

China

Japan

Malaysia

Korea

Russia

Brazil

Mexico

India

South Africa

Turkey

Indonesia

Foreign reserves in emerging countries% of GDP

1997

2015

Source: Círculo de Empresarios based on Caixabank Research, 2016Note: Gold reserves are included for some countries

Emerging: corporate debt raises in anuncertain environmentEmerging corporates will face payments of 180 billion$ in the next 4 years

Higher levels of debt leads to a lowerpotential growth in the region

Between 2007-14 corporate debt outpaced14 trillion $ (26 pp of GDP)

In 2015, total debt (private + public) reached 65 trillion$ (224% of GDP)

10

0

10

20

30

40

50

60

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Payment deadlines of emerging corporate debtBillions of $

Source: Círculo de Empresarios based on Bloomberg, 2016

435.000 millon $

-10

0

10

20

30

Change in corporate debt of emerging countries 2007-14Percentage points

Source: Círculo de Empresarios based on IMF, 2015

5047

6360 59

6670

74

40

50

60

70

80

2007 2008 2009 2010 2011 2012 2013 2014

Emerging corporate debt% of GDP


Emerging Asia: global growth leader

11

…Despite a slower pace in global economic growth

Top GDP growth countries 2016

India

+7.5%

Laos

+7.4%

Myanmar

+8.6%

Camboya

+7% +6.5%

China

Growth supported by domestic demand, especially private consumption

Lower inflation pressureses and highercurrent account surpluses

2.9% 1.7%

Inflation 2016 Current account 2016

( Forecast) ( Forecast)


5.8

5.1

5.7 5.65.4 5.3 5.3

7.8

6.47

6.86.6 6.5

6.3

4

4,5

5

5,5

6

6,5

7

7,5

8

2011 2012 2013 2014 2015 2016 2017

Real GDP in Asia%

Asia Emerging Asia


China: obstacles and policyactions

12

INDEBTEDNESS

NON-PERFOMING LOANS

REAL STATE

CAPITAL MARKETS

1

3

2

4

... Main weaknesses

...Policy responses

Liberalizationof deposit

rates

Lessrestrictions

for FDI

Lessmonopolies

Fiscalreforms

Yuan flexibility

* By 2050, China’s labor force supply will remain below 55% (70% in 2010)

... Plus demographic and productivity challenges

China: economic transition

13

1,8

Economic growth is expected to normalize

Quarterly growth*

1Q-2014: +1.7%1Q-2016: +1.1%

The sharp slowdown in industrialactivity has been mitigated by growth in the services sector (half of GDP)

Q1 contribution to GDP: 84.7% (+20 pp relative to the previous year)

China continues its gradual slowdown and rebalancing

14.19

9.629.23

10.639.48

7.7 7.68 7.31 6.89 6.7

3

6

9

12

15

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

China's real GDPAnnual change

Source: Círculo de Empresarios based on The Wolrd Bank, June 2016

2015 nominal GDP: 10 ,9 Tn $

*China still represents 50% of the asian economic growth

10,8 10,7 10,3 10,1 9,3 10,1 10,0 9,2 9,0

47,3 47,5 46,2 46,7 44,4 45,3 43,9 42,6 40,5

41,9 41,8 43,2 43,2 46,4 44,6 46,1 48,2 50,5

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011 2012 2013 2014 2015

Distribution of GDP by economic sectors % of GDP

Services

Industry

Agriculture

Source: Círculo de Empresarios based on Statista, 2016

China: convergence or divergence

14

1,8

China vs US nominal GDPTrillion $

In 10 years...China can overtake US to become the world’s biggest economy if its transition is successfull

+2% +6%

10,3

14,5

18

1,2

3,5

11,4

22,3

0

5

10

15

20

25

EEUU China

22,3

2% and 6% constant GDP growth

China’s GDP will overtake the US level in 2026 at these growth rates*

China + US = 35% of global GDP


US

39%

16%6%

24%

15%

China: share of global GDP

15

1,8

Share of global GDP%

$ of 2015


US

JapanEurozone

Rest of the world

China

1995: 2% 1995: 6%PPP terms

Rest of the worl

Eurozone

Japan

US

China

51%

12%4%

16%

17%

At market exchange rates...China is the 2nd largest economy world

...and the 1st in PPP terms

China: Channels of spillovers to Asia

1,8

Between 2000-2015 China...


China accounted for nearly 1/3 of global growthExports to China increased from 3% to 9% of world exports 22% of Asian exports (9% in 2000)

Spillovers from China to its trading partners in Asia

New Zeland

Commodity priceschannel

FinancialchannelTrade

channel

Thailand

Vietnam

MalaysiaTaiwanKorea

SingaporeJapan

1 pp of China’s GDP growth

-0,30 pp decline in growth for Asiancountries

16

China: external sector and exchange rate

17

Highest rise in 11 months

The pace of decline of currency reserves slowed

During the 2Q, the pressure on the renminbi subsided

China’s shift towards a slower growth path reinforce the weakness demand of intermediate and industrial goods

5,96

6,16,26,36,46,56,66,76,8

02.01.2014 10.04.2014 17.07.2014 23.10.2014 29.01.2015 07.05.2015 13.08.2015 19.11.2015 25.02.2016 08.07.2016

Dollar-renminbi exchange rate (reversed)


1st depreciat ion

2nd depreciat ion

Inclusion in the basket of currency

3.84

3.33

3.23 3.20 3.21 3.22 3.19 3,205

3,0

3,1

3,2

3,3

3,4

3,5

3,6

3,7

3,8

3,9

-30

-25

-20

-15

-10

-5

0

5

10

15

2014 2015 jan-16 feb-16 mar-16 apr-16 may-16

External sector and currency reserves in ChinaAnnual change, billion $

Reserves (right axis)

Exports (left axis)

Imports (left axis)

Source: Círculo de Empresarios based on Reuters and Safe, 2016

Bn $%

China: corporate debt risk

18

Total debt exceed 250% of GDP

China needs 4 yuan of new debt to generate 1 yuan of additional GDP (1 before the financial crisis)

...Which could lead to more financial instability

0

2

4

6

8

10

12

14

0 2 4 6 8 10

Mining, real state and steel firms are the most indebted and less profitable

Manufacturing

Steel

Real State

Mining

Retail and wholesale

UtilitiesConstructionmaterials

Energy

Transporation

Debt to EBITDA

Com

pa

nies

faci

nglo

sses

(% to

tal)

China’s corporates debt by sectors

Note: The size of the bubble represents the size of the sector in terms of indebtedness Source: Círculo de Empresarios based on IMF 2016

Credit growth:

Non-performing loans: 5,5% (6% of China’s GDP)

14%**

50

70

90

110

130

150

170

190

210

230

China France Spain Japan Euro area UnitedKingdom

U.S.A Italy Germany India

Non-financial private sector debt 2015% of GDP

Source: Círculo de Empresarios based on BIS, 2016

2.000

2.500

3.000

3.500

4.000

4.500

5.000

5.500

China: financial markets

19

Note:- China is the second largest banking system in the world (assets equivalent to 40% of global GDP), and its bond market is the world’s third-biggest(7.5 trillion $).

Source: Círculo de Empresarios based on Investing, 2016

* MSCI: Morgan Stanley Capital Index

Despite the bubble burst, the chinese stock market is the second largest in the world(6 bn$)

India: continued economic dynamism

20


Solid domestic demand

Source: Círculo de Empresarios based on ADB, 2016

GDP growth divergencebetween China and India

Inflation has stayed subdueddue to lower commodity prices

3.8 4 3.8

7.9 7.9

9.3 9.39.8

3.9

8.5

10.3

6.6

5.1

6.9 7.3 7.6 7.6 7.7

0

500.000

1.000.000

1.500.000

2.000.000

2.500.000

3.000.000

0

2

4

6

8

10

12

14

16

2000 2003 2006 2009 2012 2015

Evolution of real and nominal GDP in India%, millions

Real GDP India (left axis) Real GDP China (left axis)Nominal GDP India (right axis)

Private consumption

55%

Public spending

4%

GFCF23%

Others17%

External Sector

1%

8.6

3.3

5.2

0

1

2

3

4

5

6

7

8

9

10

Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16

Inflation rate IndiaAnnual change, %

Total Core Trend

India: external sector and reserves

21Source: Círculo de Empresarios based on Asia Development Bank, 2016

Lower global demand reduces its exports

... But strong currency reserves

Currency reserves increased to $350 bn(+4% change vs previous year)

FDI in India in 2015 = $322 bn (vs. +29% in 2014)

By 2030 its population willovertake the amount of 1.4 bnpeople

7 Indian companies in Fortune 500

2nd country by English speakers

200

220

240

260

280

300

320

2011 2012 2013 2014 2015

External sector IndiaBillions of $

Imports (ex. Energy)

Exports (ex. Energy)

250

260

270

280

290

300

310

320

330

340

Jan-14 Jun-14 Nov-14 Apr-15 Sep-15 Feb-16

India's currency reservesBillions of $

Japan: economic stagnation

22

The appreciation of the yen, a loweconomic feeling, the impact on theearthquakes in the región of Kuramotoand the demographic pressures, amongothers, limits the economic growth

Quarterly GDP and private consumption%

Inefficientmonetary

policy

Fall of real wages

(minimums of 30 years)

Weakprivate

consumptionExports

contraction

2 of the last 4 quarters in recession PMI in minimums of 2013 GDP grew on average 0.8% (200-2015)

Good exports(Annual change)

Source: Círculo de Empresarios based on Bloomberg, OECD, 2016

-5,5

-4,5

-3,5

-2,5

-1,5

-0,5

0,5

1,5

2,5

1Q-2014 2Q-2014 3Q-2014 4Q-2014 1Q-2015 2Q-2015 3Q-2015 4Q-2015 1Q-2016

Quarterly

Private consumption

-15

-10

-5

0

5

10

15

100

150

200

250

300

350

400

450

Jan-

11 M

ar-1

1 M

ay-1

1 Ju

l-11

Sep-

11 N

ov-1

1 Ja

n-12

Mar

-12

May

-12

Jul-1

2 Se

p-12

Nov

-12

Jan-

13 M

ar-1

3 M

ay.1

3 Ju

l-13

Sep-

13 N

ov-1

3 Ja

n-14

Mar

-14

May

-14

Jul-1

4 Se

p-14

Nov

-14

Jan-

15 M

ar-1

5 M

ay-1

5 Ju

l-15

Sep-

15 N

ov-1

5 Ja

n-16

Mar

-16

Japan: monetary policy

23

Bank of Japan (BOJ) balance sheetTrillion ¥

Japan’s Inflation rateAnnual change

Source: Círculo de Empresarios based on St. Louis Fed, OECD, 2016

85.2% of GDP

In May 2016, The Bank of Japan has 36% of its public debt (Forecast of 50% in 2018)

Japan represents 70% of the sovereignglobal debt with negative interest rates(7.9 bn$)

Despite the introduction in January of negative interest rates, the expectationsof inflation remained moderate

-0,5

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0

Jan-14 Apr-14 jul-14 oct-14 Jan-15 Apr-15 jul-15 oct-15 Jan-16 Apr-16

CPI Core CPI Goal

Japan: public finances

24

*Data for 2015. ** Structural deficit: -4.8%Source: Círculo de Empresarios based on BIS, JMA, 2016

Continues the high indebtedness

Debt: 247.4% of GDPDeficit: -5.2% of GDP**

Public sector*

Non-financial private sectorDebt: 167.2% of GDP

Note: Japan allocates more than 24.4% of the anual budgetto the service of the debt...

Latin America: diverse outlook

25

Recoverycommodities

Lowerfinancialtensions

Inflationarypressures

... though the economic conditionsimprove

Divergences in economic activity growth...

PACIFIC ALLIANCE

LATIN AMERICA

MERCOSUR

+2.3%

-1.1%

-3.7%

Source: Círculo de Empresarios based on BBVA Research, 2016Pacific Alliance: Chile, Colombia, Per y MexicoMercosur: Argentina, Brazil, Paraguay, Uruguay, Venezuela y Bolivia (in proccess of joining)

Latin America: uncertain future

26

Second consecutive year ofrecession in 2016

Growth prospects will mainly depend on...


Real GDP growth (%)Forecast

RAW MATERIALS

POLITICAL STABILITY

EXTERNAL DEMAND

3 2.9

1.1

-0.4-1.1

1.7

-6

-4

-2

0

2

4

6

2012 2013 2014 2015 2016 2017

Brazil

Argentina

Mexico

Latin America

Brazil crisis will drag on economic growthof the regionThe largest economy in Latin America will continue in recession...

Brasil’s real GDP%

Forecast

Source: Círculo de Empresarios based on IMF, BBVA Research, 2016

Potential GDP = 1%

Greatest recession in decades

4.4

1.4

3.1

1.1

5.8

3.24

6.15.1

-0.1

7.5

3.9

1.93.0

0.1

-3.8-3

0.9

-6

-4

-2

0

2

4

6

8

10

2000 2002 2004 2006 2008 2010 2012 2014 201627

Brazil: significant imbalances

Inflation9%

Public debt67%

Approvalrating25%

Fiscal deficit–9%

Domestic demand deceleration will drive inflation down

High rigidities of public spending

The political environment is expected to remain turbulent with a moderateapproval rating of the new government.

Slowing down the necessary reforms to: 1)increase confidence and 2) reduce fiscal deficit

However... the risk of the country facing a balance of payments* crisis decreasesdue to:

High FDI 4.6% of GDP Current account deficit: -2.4% of GDP Net external creditor (reserves: 22% of

GDP and external debt:19% of GDP).

Source: Círculo de Empresarios based on BBVA Research and World Bank, 2016* Latest data available: June 5th 2016 28

US: positive leading indicators (I)

Improvement of the expectations of the manufacturing sector...

Average 12 months:

50.3

*Indicator that evaluates US industryNote: The ISM non-manufacturing recovered in June up to 56.6 demonstrating the strenght of growth in the 2QSource: Círculo de Empresarios based on ISM, 2016

ISM manufacturing*

51.9

51

5049.4

48.448 48.2

49.5

51.8

50.8

51.3

53.2

47

48

49

50

51

52

53

54

Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16

Expansion

Contraction

29

US: positive leading indicators (II)

Rise in building permits...

Building permitsMillions

Source: Censusgov, 2016

Strenght of the real state sector

Sales of newly- built US homesAnnual rate

Source: Fed St Louis, 2016

4,5

4,7

4,9

5,1

5,3

5,5

5,7

30

0

500

1.000

1.500

2.000

2.500

US: 1Q slightly better than expected

31

Moderate growth, but revised upward

Growth forecast 2016: [2-2.5%]*

Slow down of the private consumptionand weakness of investment

Qurterly real GDP annualized%

Consumption, Investment and Exports%

Source: Círculo de Empresarios based on BEA, 2016

0.8% last estimate

* Average estimations international organisms

1.91.3

0.50.1

1.91.1

33.8

-0.9

4.6 4.3

2.1

0.6

3.9

21.4 1.1

-2

-1

0

1

2

3

4

5

-10

-5

0

5

10

15 Private Consumption

Private Investment

Exports

US: unemployment in minimum levels

Uemployment rate remains at structural unemployment levels

Unemployment rate evolution (%)

Structural unemployment: 4.8%

Jobless claims

Source: BLS, StLouisFed

Jobless claims are still stable and at low levels (254,000 on July 8th)

6.7

4.9

4,0

4,5

5,0

5,5

6,0

6,5

7,0

Jan

-14

Feb

-14

Mar

-14

Apr

-14

May

-14

Jun

-14

Jul

-14

Aug

-14

Sep

-14

Oct

-14

Nov

-14

Dic

-14

Jan-

15 F

eb-1

5 M

ar-1

5A

pr-1

5 M

ay-1

5 J

un-1

5 J

ul-1

5 A

ug-1

5 S

ep-1

5 O

ct-1

5 N

ov-1

5 D

ic-1

5 J

an-1

6 F

eb-1

6 M

ar-1

6 A

pr-1

6 M

ay-1

6 J

un-1

6

230.000

280.000

330.000

380.000

430.000

480.000

530.000

580.000

630.000

680.000

730.000

2009-01-03 2010-01-03 2011-01-03 2012-01-03 2013-01-03 2014-01-03 2015-01-03 2016-01-03 32

US: job creation

Strenght in job creation(222,000 average in the12 previous months)

Job creation (thousands)

Source: BLS, StLouisFed, 2016

Low labour participation

Labour participation rate (%)

* Verizon’s strike

*

187168

272

310

213

306

232218

286

200

331

292

221

265

84

251273

228

277

150149

295280

271

168

233

186

144

11

287

0

50

100

150

200

250

300

350

66

62.762

63

64

65

66

67

Jan-

08 M

ay-08

Sep-

08Ja

n-09

May

-09 Se

p-09

Jan-

10 M

ay-10

Sep-

10 Ja

n-11

May

-11 Se

p-11

Jan-

12 M

ay-12

Sep-

12 Ja

n-13

May

.13 Se

p-13

Jan-

14 M

ay-14

Sep-

14Ja

n-15

May

-15 Se

p-15

Jan-

16 M

ay-16

33

US: Upward pressure on inflation

Source: OECD, FedAtlanta, 2016

Salary growth (%)

Core inflation (2.2%) surpasses theFed’s target of 2% and reaches itshighest rate since beginning of 2012

Upward revisions of inflation due to the oil price recovery

Upside risk to wage inflation

1,0

1,5

2,0

2,5

3,0

3,5

4,0

Jan-

10 A

pr-1

0 J

ul-1

0 O

ct-1

0 J

an-1

1 A

pr-1

1 J

ul-1

1 O

ct-1

1 J

an-1

2 A

pr-1

2 J

ul-1

2 O

ct-1

2 J

an-1

3 A

pr-1

3 J

ul-1

3 O

ct-1

3 J

an-1

4 A

pr-1

4 J

ul-1

4 O

ct-1

4Ja

n-15

Apr

-15

Jul

-15

Oct

-15

Jan

-16

Apr

-16

-0,50,00,51,01,52,02,53,03,54,04,5

Core Total Target

Inflation rate evolution (%)

34

US: FED monetary policy

If the Fed keeps its strategy (inflation + employment) there is an expectation of at least anincrease in the interest rates this year (probably in December) determined by how theuncertenties after the Brexit clear out.

20162017

2018

Employment

Inflation

Interestrates

Rise in interest rates possible calendar

Note: The dots represent the possible rises of interest rates

35

US: Fed’s caution

After the rise on December, the Fedmaintains interest rates in the range0,25 - 0,5%

According to Taylor’s Rule, interestrates should be above 3%

Federal fund interest rates (%)

Source: Federal Reserve, 2016

The delay of the rise of interest rates is, fundamentally, due to…

BREXITCONSOLIDATION OF THE LABOUR

MARKETFINANCIAL

TURBULENCE

*Monetary policy rule that determines themain interest rate in response to inflationand output gap

0

1

2

3

4

5

6

Jan-

08 J

un-0

8 N

ov-0

8 A

pr-0

9 S

ep-

09 F

eb-1

0 J

ul-1

0 D

ic-1

0 M

ay-

11 O

ct-1

1 M

ar-1

2 A

ug-1

2 J

an-

13 J

un-1

3 N

ov-1

3 A

pr-1

4 S

ep-

14 F

eb-1

5 J

ul-1

5 D

ic-1

5 M

ay-

16oc

t.-15

jun.

-16

36

Europe: the recovery continues

37

Top countries in the eurozone by GDP growth in the 1Q-16 Annual change

1%1.4%

1.6%3.4%

Spain leads the economic growth of the eurozone, growing more than 2.1 times faster than Germany

1Q-2016 2017* 2018*

1.8% 1.8% 1.9%

EU-28

* Forecast spring European Commission

Source: Círculo de Empresarios based on Eurostat y ECB, 2016

Eurozone: growth components

In the private consumption and labour market the dynamic is maintained

JOB CREATION

PRIVATE CONSUMPTION

GDP GROWTH

* Note: Investment will increase 2.9%, but still far from pre-crisis levelsSource: Círculo de Empresarios based on Eurostat and ECB, 2016

+1.7

+1.7%

+1.4%

55% of GDP in 1Q-16(1.45 bn €)

10.1% unemployment in May(16.3 millon) Contribución to growth

1 pp Private consumption

0.3 pp Public spending

0.6 pp Investment

1.4 pp Exports

0.2 pp Inventories

1.8 pp Imports

38

Eurozone: economic growthQuarterly real GDP evolution

Source: Círculo de Empresarios based on Eurostat, 2016

2Q-16: sustained growth, but slightly lower

3.5

-5.5

1.7

-6-5-4-3-2-101234

39

Eurozone: labour market

40

In spite of the positive data of job creation, there are still 16,3 millionunemployed in the eurozone (21,1 million in the EU-28)


Unemployment rate by countries% active population

24.121

11.6 11.5 10.1 9.9 9 8.6 8.4 7.8 6.3 6.14.2

0

5

10

15

20

25

30

-0,2

0,8

-1,0

0,0

1,0

2,0

3,0

4,0

5,0

Jan-

07 A

pr-0

7 J

ul-0

7 O

ct-0

7Ja

n-08

Apr

-08

Jul

-08

Oct

-08

Jan-

09 A

pr-0

9 J

ul-0

9 O

ct-0

9Ja

n-10

Apr

-10

Jul

-10

Oct

-10

Jan

-11

Apr

-11

Jul

-11

Oct

-11

Jan

-12

Apr

-12

Jul

-12

Oct

-12

Jan

-13

Apr

-13

Jul

-13

Oct

-13

Jan

-14

Apr

-14

Jul

-14

Oct

-14

Jan-

15A

pr-1

5 J

ul-1

5 O

ct-1

5 J

an-1

6 A

pr-1

6

General

Core

Eurozone: prices

41

Low inflation rate continue... However the core increases gradually

Note: The predictions of inflation for 2016, 2017 and 2018 according to the ECB are: 0.3%, 1.3%, 1.6% Source: Círculo de Empresarios based on Eurostat, ECB, 2016

Since the end of 2014, the negativecontribution of the prices of energy has fluctuated between 0.5 and 1 pp

%

Eurozone: ECB monetary policy

42

The ECB maintain interest rates from its last intervention in March of 2016…

Interest rates* Deposit type

0% -0.4%

Monthly purchases Liquidity actions (TLTRO II)

80Bn€ 4* Currently, there are more than 12 billion in global sovereign debt with negative interest ratesSource: ECB, 2016

Eurozone: ECB monetary policy

3.23 bn €ECB balance (euro)

The ECB balance continues in in expansion

Eligible marketable assets (%)

Source: Círculo de Empresarios based on ECB and Caixabank Reserach, 2016

Corporate Quantitative Easing starts…

9.6%: AAA-AA35.2% : A55.2%: BBBBy ratings...

0

500.000

1.000.000

1.500.000

2.000.000

2.500.000

3.000.000

3.500.000

Jan-

00 Ju

l-00

Jan-

01 Ju

l-01

Jan-

02 Ju

l-02

Jan-

03 Ju

l-03

Jan-

04 Ju

l-04

Jan-

05 Ju

l-05

Jan-

06 Ju

l-06

Jan-

07 Ju

l-07

Jan-

08 Ju

l-08

Jan-

09 Ju

l-09

Jan-

10 Ju

l-10

Jan-

11 Ju

l-11

Jan-

12 Ju

l-12

Jan-

13 Ju

l-13

Jan-

14 Ju

l-14

Jan-

15 Ju

l-15

Jan-

16

9.811

12.1

44

23

Energy Financial Industry Consumption Utilities

43

Brexit complicates the scenario

23th referéndum results

Remain

48.1% 51.9%

Leave

(16,141,242) (17,410,742)Votes

Leave

Remain

UNCERTAINTYPOLITICAL CRISIS / CONTAGION

EFFECT

ECONOMICSHOCK

FINANCIALSHOCK

Brexit main consequences

Source: Círculo de Empresarios based on Bloomberg 44

Brexit: firsts impacts on UK

GDP revisions

Ratings downgrades

Monetary policy

S&P from AAA to AA

The Bank of England has reduced capital requirements to the banks from 0.5% to 0%.

The IMF has revised 1.2 PP itspredictions of growth for UK by 2017

Source: Círculo de Empresarios based on Reuters, 201645

1,1

1,2

1,3

1,4

1,5

1,6

1,7

Pound/Dollar Pound/Euro

Brexit: financial shock

Weakening of the pound and doubts about the viability of the financial hub in London

FINANCIAL SECTOR7% GDP

EMPLOYMENT4% GDP

EXPORTS FINANCIAL SERVS.

2.7% PIB*

Source: Círculo de Empresarios based on ONS, BBVA Research, 2016

* 40% of total goes to the EU

Pound vs. Euro and Dollar

Worst level of the poundsince 1985 and since Brexithas lost a 13% and a 11% against the $ and the €.

Since 2007, the pound has fallen down a 20% againstthe $.

46

Brexit: economic shock

Forecasts about the impact of Brexit until 2018

GDP

Unemployment

Wages

Housing(prices)

Deficit

-3.6%

+520,000

Baselinescenario

Adverse scenario

-6%

+820,000

-2.8%

-10%

-4%

-18%

+24 bn £ +39 bn £

Note: The scenario will depend on the final agreement between the EU and the UKSource: Círculo de Empresarios based on HM Treasury, 2016

+0.93 % of GDP +1.5 % del PIB

47

Brexit: political uncertainty

Since UK referendum

Short term (2020)

Long term(after 2020)

• National policy impasse• Stagnation in the

European project

• Eventual referendum in Scotland• Regulatory uncertainty

• EU political guidance• Risk for the eurozone

integration

Brexit threatens political cohesion not only in UK but also in the European Union

Source: Círculo de Empresarios based on AFI, 2016

48

Italy: triple risk

1ANEMICGROWTH

2BANKINGSECTOR

3POLITICALUNCERTAINTY

1 Following the crisis, Italy has recovered lessthan the average of the eurozone

2 Doubts about the Italian banking sector solvency

3 Political risk associated to the referendumon its Constitution

Nominal GDP growth: Italy vs. Eurozone (average)2006=100


Non-performing loans (NPL’s)% total


5,8 6,3

9,4 1011,7

13,7

16,518 18

0

3

6

9

12

15

18

21

2007 2008 2009 2010 2011 2012 2013 2014 2015

NPL’s= € 350 billion (21.4% of GDP)

95

100

105

110

115

120

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

eurozone Italy

49

20

25

30

35

40

45

50

55

60

65

Commodities: recovery in oil pricesOil price increases, encourage by the lower supply dinamism

51.23

26.21

Source: Círculo de Empresarios based on St.LouisFed, IEA, 2016

Disruptions in Canada + Nigeria - 3.6 mbd

Despite the increse of oil prices, the excess of supply is slightly higher than 1 mbd

WTI evolution, $

50

Commodity prices (II)

51

Commodity prices evolution2005=100

SILVER ZINC GOLD SUGAR NATURALGAS

Highest increases since January 2016...

Source: IMF and Bloomberg, 2016

50

90

130

170

210

250

290

Jun

-07

Se

p-0

7 D

ic-0

7 M

ar-0

8 J

un-0

8 S

ep

-08

Dic

-08

Ma

r-09

Jun

-09

Se

p-0

9 D

ic-0

9 M

ar-1

0 J

un-1

0 S

ep

-10

Dic

-10

Ma

r-11

Jun

-11

Se

p-1

1 D

ec-

11 M

ar-1

2 J

un-1

2 S

ep

-12

Dic

-12

Ma

r-13

Jun

-13

Se

p-1

3 D

ic-1

3 M

ar-1

4 J

un-1

4 S

ep

-14

Dic

-14

Ma

r-15

Jun

-15

Se

p-1

5 D

ic-1

5 M

ar-1

6 J

un-1

6

Total Non-energy Energy Metals

-20 -15 -10 -5 0 5 10 15 20

Japanese yenBrazilian realRussian ruble

Canadian dollarAustralian dollar

Swiss franceEuro

Turkish liraIndian rupee

Chinese yuanArgentine peso

Pound sterling

Currency markets

52

Change since January 2016 against the dollar%

After a minimums of 31 years, the pound is the currency that suffers a greater drop against the dollar…

Brexit


Minimums 2010

“safe haven asset” IMPACT China impact +

commodityprices

80

85

90

95

100

105

Jan.-4th Jan.-19th Feb.-12th Mar.-4th Mar.-29th Apr.-19th May.-10th May.-31st Jun.-21st

IBEX 35 EUROSTOXX 50

Financial markets (I)The surprise of the Brexit has generated volatily and drops in equity markets

Greatest decline of the Ibex in its history

Source: Círculo de Empresarios based on Investing, 2016

-12.35% -7.1% -10.9%24 th june drops

Ibex 35 and Eurostoxx 50January 1st 2016=100

53

-43-39

-32

-26 -25-23 -22 -21

-19

-8

-50

-45

-40

-35

-30

-25

-20

-15

-10

-5

0

Financial markets (II)After Brexit... The European banking sector capitalization has fell downby more than € 200 bn

- 24,9 bn €

%

Source: Círculo de Empresarios based on Goldman Sachs, 2016 54

Stock markets. Year to date yield

YTD global stock markets yieldsJanuary – July 12th 2016

Global uncertainty and Brexit affect stock markets

Volatility index (V2X) jumps after brexit

... With a high capital flow towards safe haven assests

GERMAN BOND

US BOND GOLD JAPANESE

YENUS

DOLLAR


8.2 6

-6.4 -7.3-9.4 -10.3 -12

-18-22.5-25

-20

-15

-10

-5

0

5

10

Ftse 100(United

Kingdom)

S&P 500(USA)

Dax(Germany)

Cac 40(France)

ShanghaiComposite

(China)

Eurostoxx 50 Ibex 35(Spain)

Nikkei(Japan)

FTSE MIB(Italy)

55

56

ENTORNO GLOBAL

Oil prices

Financial costs

Expansive monetary policy and neutral fiscal policy

Growth in the EMU

Growth boosts

57

123

56

Improvements in the labourmarket

Rising exports to the Europeanmarket

Domestic demand

4

7

Forecasts: the recovery continues…

58

2016* 2017*

2.7%

2.3%

*ForecastsSource: Bank of Spain, June 2016

… but at a moderate pace.

3.2%

2015

The Governement has revised its forecasts upward for 2016, from 2.7% in Aprilup to 3%.

Forecasts 2016: composition of growth

59

GDP annual growth in 2016 = 2.7%.

• Private consumption = 3%

• Public consumption= 1.1%

• GFCF = 4.8%

• Exports = 4.3%

• Imports = 5.2%

Domestic demand

0,2 pp2.9 pp

External demand

contribution to growth

contribution to growth

Source: Círculo de Empresarios, based on Bank of Spain data, June 2016

60

Domestic demand and services exports support the recovery

Private consumption leads therecovery in Spain:

+ employment growth

+ income

+ credit

+ non-financial wealth

Despite national and international uncertainties, Spainkeeps its growth rate aboveOECD and eurozone

-8

-6

-4

-2

0

2

4

6

GDP (interannual change) and contribution of domestic and external demand (pp) Domestic demand

External demandGDP SpainGDP eurozoneOECD GDP

Source: Círculo de Empresarios, based on NSI, Bank of Spain and OECD, 2016

GDP growth

61

Industry

Good performance of industrial production

By regions, Catalonia, Andalusiaand Valencian C. lead industrial production, followed by BasqueCountry, Castile and Leon and Madrid

-25-20-15-10

-505

10

2

016M

05

201

6M01

2

015M

09

201

5M05

2

015M

01

201

4M09

2

014M

05

201

4M01

2

013M

09

201

3M05

2

013M

01

201

2M09

2

012M

05

201

2M01

2

011M

09

201

1M05

2

011M

01

201

0M09

2

010M

05

201

0M01

2

009M

09

200

9M05

2

009M

01

200

8M09

2

008M

05

200

8M01

Industrial Production Index

Source: NSI, 2016

18.9

13.4

9.4

6.1 5

18.8

5.23.1 3.5

1.7 2.6 2 1.1 1.6 0.7

3.92.5

23.1

11.4 10.69.6

7.3 7 6.85 4.9

3.7 3.32.3 1.3 1.3 1.1

0.9 0.4

Industry by regions% GDP; % national industry

% GDP % National industry

Source: NSI, 2016

62

Labour market

June 2016:

▼ Unemployed = 124,349 vs. May(48,579 in seasonally adjusted terms)

▲ Affiliates = 98,432 vs. May

▲ Registered contracts = 1,920,340

Unemployment rate in Spain, May 2016 = 19.8% vs. eurozone average = 10.1%

16.393.866

17.760.271

4.763.6803.767.054

0

1.000.000

2.000.000

3.000.000

4.000.000

5.000.000

6.000.000

16.000.000

16.500.000

17.000.000

17.500.000

18.000.000

18.500.000

19.000.000

19.500.000

20.000.000

2007

2008

2009

2010

2011

2012

2013

2014

2015

Jan

16

Feb

16

Mar

16

Apr

16 M

ay 1

6 J

un 1

6

Affi

liate

s

Evolution of affiliation to Social Security and registered unemploymentPersons Affiliates Unemployed

Unemployed

Source: Círculo de Empresarios based on Ministry of Employment data, July 2016

63

Unemployment rate and labour marketreforms

21

26.9

24.2

19.8

7.9

9

10.3

13.4

21.6

24.6

15.6

21.7

19.6

4.4

2

016Q

1

201

5Q1

2

014Q

1

201

3Q1

2

012Q

1

201

1Q1

2

010Q

1

200

9Q1

2

008Q

1

200

7Q1

2

006Q

1

200

5Q1

2

004Q

1

200

3Q1

2

002Q

1

200

1QI

2

000Q

I

199

9QI

1

998Q

I

199

7QI

1

996Q

I

199

5QI

1

994Q

I

199

3QI

1

992Q

I

199

1QI

1

990Q

I

198

9QI

1

988Q

I

198

7QI

1

986Q

I

198

5QI

1

984Q

I

198

3QI

1

982Q

I

198

1QI

1

980Q

I

197

9QI

1

978Q

I

197

7QI

Unemployment rate%

Source: NSI, 2016

Reform 1984

Reform 1994

Reform 1997

Reform 2001

Reform 2006 Reform

2010

Reform 2012

64

Temporary employment and labourmarket reforms in Spain

15.6

33.5

32,2

35

31,4

34,6

24,3

25,9

22

26,2

25,1

1987

1989

1991

1993

1995

1997

1998

Q2

1998

Q4

1999

Q2

1999

Q4

2000

Q2

2000

Q4

2001

Q2

2001

Q4

2002

Q2

2002

Q4

2003

Q2

2003

Q4

2004

Q2

2004

Q4

2005

Q2

2005

Q4

2006

Q2

2006

Q4

2007

Q2

2007

Q4

2008

Q2

2008

Q4

2009

Q2

2009

Q4

2010

Q2

2010

Q4

2011

Q2

2011

Q4

2012

Q2

2012

Q4

2013

Q2

2013

Q4

2014

Q2

2014

Q4

2015

Q2

2015

Q4

Temporary employment in Spain% of dependent employment

Source: OECD and Eurostat, 2016

2016 Q1

1984▲ temporary employment (vs .unemployemnet> 20%)

1994- ▼ temporary employment- ▲ youth labour integration- Ease labour relations and

dismissal conditions- Legalization of temporary agencies

1997- ▲ permanent employment- Limits to temporary contracts- Changes on integration contracts conditions

2001- ▲ part-time contracts- ▲ convers ion of temporary contracts to permanent ones

2006- ▲ permanentcontracts

- Improvement in temporarycontracts

2012- ▼ duality and ▲permanent employment

-▲internal flexibility(to avoid dismissals)- More modern collective agreements,adapted to the companiesand workers needs-▲ employability

2010- ▼duality- ▲internal and wageflexibility in companies

- ▼ dismissal costs- Optout clause incol lective agreements

Unemployment in regional administrations 1Q 2016

65

Galicia18.24%(▼3.6)

Heterogeneity between admionstrations% of working populationChange in percentage points (pp)vs. 1Q 2015

Asturias19.5%(▲0.5)

Cantabria18.9%(▲0.4)

Basque C.12.8%(▼3.6)

La Rioja14.38%(▼3.2)

Navarre14.25%(▼1.4)

Aragon15.28%(▼3.3)

Catalonia17.42%(▼2.6)

Valencian C.21.84%(▼2.4)

Murcia22.1%(▼4.6)

Andalusia29.7%(▼3.9)

Balearic Islands18.41%(▼3.9)

Canary Islands26%

(▼4.8)

Extremadura29.13%(▼1.1)

Castile and Leon18.33%(▼2.1)

Madrid16.81%(▼1)

Castile-La Mancha25.45%(▼3.2)

Source: Círculo de Empresarios, based on NSI data, 2016

<15%

> 20%>15-20%

National unemployment21% of working population.

Structural unemployment18%

Ceuta30.7%(▼5.6)

Melilla26.2%(▼4.7)

66

Prices

In 2016:

Interannual CPI in Spain

returns to negative values

Core inflation goes

down

Spread of prices with

the eurozone has

increased again

-0.8

0.6

0.1

-1,5

-1

-0,5

0

0,5

1

1,5

2016

M06

2016

M05

2016

M04

2016

M03

2016

M02

2016

M01

2015

M12

2015

M11

2015

M10

2015

M09

2015

M08

2015

M07

2015

M06

2015

M05

2015

M04

2015

M03

2015

M02

2015

M01

2014

M12

2014

M11

2014

M10

2014

M09

2014

M08

2014

M07

2014

M06

General and core inflationInterannual change %

CPI Spain

Core inflation Spain*

CPI eurozone

* Without energy and non-processed foodSource: NSI, 2016

67

Financial conditions

The increase of credit supports the

recovery: it increases for consumption,

agriculture and industry

Default rate falls down while it is still

very high in the contruction and

developer sectors

Credit and default rate in Spain 1Q 2016Bn €; %

Balance 1Q 2016

Interannual change Default rate

Households (housing) 547 -4.7 4.8Households (consumption) 112 3.3 8.8Productive activities 616 -8.8 14.6 Construction 43 -11.2 29.1 Developer 129 -12.1 27.6 Serv ices 316 -10.7 9.2 Industy 110 0.7 10.2 Agriculture 19 5.3 9.6Total 1.275 -6.1 9.9

Source: CaixaBank based on Bank of Spain data, 2016

Public accounts – revenues, expendituresand balance

68

Structural balance = 3%.

Doubts about the target compliance of déficit in 2016 (3.7%).

-1,0-0,5 -0,4 -0,4

0,01,2

2,2 2,0

-4,4

-11,0

-9,4 -9,5

-10,4

-6,9-5,9

-4,5-3,4

-12

-10

-8

-6

-4

-2

0

2

4

30

32

34

36

38

40

42

44

46

48

50

Public revenues and expenditures% GDP

Revenues

Expenditures

Balance

* ForecastsSource: IMF, 2016

Public and private debt

69

Households and companies still reduce its debt, currently = 149.8 % of GDP.

0

200.000

400.000

600.000

800.000

1.000.000

1.200.000

1.400.000

ma

y-07

nov-

07m

ay-

08no

v-08

ma

y-09

nov-

09m

ay-

10no

v-10

ma

y-11

nov-

11m

ay-

12no

v-12

ma

y-13

nov-

13m

ay-

14no

v-14

ma

y-15

nov-

15m

ay-

16Non-financial sectors debtMillion €

PPAA

Non-financial companies

Households

Source: Bank of Spain, 2016

58,054,2

51,347,6 45,3

42,338,9

35,539,4

52,7

60,1

69,5

85,4

93,799,3 99,2

100,599,0

100,0

PPAA debt% GDP

Source: Bankof Spain, 2016

Public debt has incresed to more than 100% of GDP

Social Security

70

Social Security deficit has increased to16,767 million euros (1.55% of GDP).

According to the Círculo de Empresarios’ last estimates, if the pace of withdrawals were to continue, the Reserve Fund will be dried up in 2018.

July 1st 2016 → 8,700 million were withdrawn from the Fund to guarantee a punctual extra payment of contributory pensions, approximately 5,000 million more than in the same date of the previous year

Current balance = 25,176 millions € (2.33% of GDP).

1,700

1,363

1,530

410

3,500

1,0001,000

720

5,000

428

5,500

500

8,000

1,300

3,750

7,750

1,750

8,700

Social Security Reserve Fund withdrawals since 2012Million euros

Source: Social Security's Treasury, 2016

80.000

90.000

100.000

110.000

120.000

130.000

140.000

150.000

-20.000

-15.000

-10.000

-5.000

0

5.000

10.000

15.000

20.000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Social Security accountsMillion euros (+) Superavit / (-) Deficit

Revenues

Expenditures

Source: Ministry of Employment and Social Security, 2016

EUROPE63,3

ASIA19,1

AMERICA9,8

AFRICA7,6

OTHER0,2

EUROPE72,9

AMERICA9,9

ASIA9,4

AFRICA6,3

OTHER1,5

71

Exports

January – April 2016 (interannual change)

▲ 1.8% (83,345.8 M€)

Imports ▼ -0.8% (88,926.6 M€)Trade balance ▼ 28.2% in DEFICIT (-5,580.8 M€)

▼ 41.8% in energy deficit

Geographical distribution (%)

TOP3

SEC

TORS

Expo

rtsIm

ports

EU

Rest of Europe

5.6%

67.3%

EU

Rest of Europe

57.5%

5.8%

China8,6%

Source: Círculo de Empresarios, based on Ministry of Economy data, June 2016

External sector

China1.9%

-94.159,9 -24.173,9 -5.580,8-100.000

-50.0000

50.000100.000150.000200.000250.000300.000

Exports, imports and trade balanceMillion €

Exports Imports Trade balance

Exports % / total Imports % / total

Capital assets 19.9 Capital assets 21.2

Automobile 18.9 Chemistry 16.4

Food, beverage and tobacco

17.1 Automobile 14.9

Export companiesJanuary – April 2016

72

85,474 export companies.

68.6% (58,628) exported

less than 50,000 euros.

31.4% (26,846) exported

more than 50,000 euros →

99.6% del valor total.

Regular export companies = 43,674 (51% of the total). They exported79,471.3 million euros, 92.97% over total.

External trade January-April 2016

nº % of the total Million € % of the totalTotal 85.474 100 83.345,8 100x < 50.000 € 58.628 68,6 366,3 0,4x >/= 50.000 € 26.846 31,4 82.979,5 99,6 50.000 € </= x < 0,5 M € 15.280 17,9 3.025,1 3,6 0,5 M € </= x < 5 M € 9.340 10,9 14.871,2 17,8 5 M € </= x < 50 M € 2.044 2,4 26.600,5 31,9 50 M € </= x < 250 M € 149 0,2 15.067,2 18,1 x >/= 250 M € 33 0,0 23.415,5 28,1

Source: Ministry of Economy, 2016

Export companies Export value

Interest rates and risk premium

73

The German bond isin negative values.

After Brexit and Spain´sgeneral elections, riskpremium has recoveredto March levels.

0

20

40

60

80

100

120

140

160

180

-0,5

0

0,5

1

1,5

2

2,5

3

3,5

Ten years bond yields. Spain and Germany (%)Risk premium (pb)

Spain

Germany

Risk premium

Source: Círculo de Empresarios based on Bank of Spain data, 2016

Risk premiumInterest rate

Ibex 35

74

Ibex 35 fell down a12.35% the dayafter Brexit.

After general elections it has recovered (▲ 8.4% between June 27th and July 11th).

7.500

7.700

7.900

8.100

8.300

8.500

8.700

8.900

9.100

9.300

9.500

11.07.201601.07.201623/06/201615/06/2016

Ibex 35

Source: Investing, 2016

24/06/16Post-Brexit

75

Spain´s position in international rankings

Hong Kong

Switzerland

USA

SPAIN

1

2

3

34

USA

Canada

Australia

SPAIN

1

2

3

12

Iceland

Denmark

Austria

SPAIN

1

2

3

25

USA

China

India

SPAIN

1

2

3

28

China

USA

Germany

SPAIN

1

2

3

25

World Competitive Index 2016

Global Peace Index 2016

Index on Digital Life 2016

Renewable Energy Country Attractiveness Index 2016

Global ManufacturingCompetitiveness Index 2016

Source: IMD, 2016 Source: Telefónica, 2016

Source: Institute for Economics and Peace, 2016Source: EY, 2016

Source: Deloitte. 2016

Norway

Australia

Denmark

SPAIN

1

2

3

19

Better Life Index 2016

Source: OECD, 2016

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