Artículos

With Donald Trump back in the headlines and global fragmentation accelerating, the European Union faces mounting external pressures — from rising protectionism to weaponized trade and geopolitical instability. In this volatile environment, Europe’s single market emerges as a fundamental strategic asset — critical to the EU’s economic resilience, competitiveness, and even geopolitical autonomy.

The defence sector in Europe is experiencing renewed momentum in investment and consolidation, driven by structural challenges, strategic imperatives, and institutional initiatives. While structural and regulatory barriers persist, the sector’s strong fundamentals and strategic relevance are expected to sustain momentum in consolidation and investment going forward.

Spain’s tax revenue rose sharply in 2024, led by strong growth in personal income tax, VAT, and corporate income tax. While this helped reduce the public deficit, the non-indexation of PIT has eroded real household incomes and intensified fiscal drag.

After years of trading below book value despite solid fundamentals, Spanish and European banks have seen a marked revaluation since late 2024, surpassing price to book value (P/BV) ratios of 1x. Improved margins have supported a strong recovery in valuations, narrowing the profitability gap with U.S. peers; however, structural and regulatory differences continue to explain the persistent valuation gap between European and U.S. banks.

Despite robust growth and a declining headline deficit in 2024, Spain’s underlying fiscal trajectory remains fragile due to persistent structural imbalances and high public debt levels. With the new EU fiscal framework taking effect and long-term spending pressures building, credible consolidation measures are becoming increasingly necessary.