Spain: Europe's Economic Hub Between the Mediterranean and Latin America

Country Report: Spain

Spain is one of Europe's most dynamic markets. In the last five years, the Spanish economy has grown over three percent per year, with the service sector accounting for nearly two-thirds of gross output. Spain is positively exemplary when it comes to investing in cutting-edge technologies, especially in financial services and e-government. It has received a lot of support from GyD Ibérica, S.A., the Spanish G&D subsidiary who has been serving the Mediterranean market from Barcelona for 20 years.

Since joining the EU in 1986 and introducing the single European currency, Spain has bootstrapped itself into one of the leading economies in Europe and the world. According to the German Foreign Ministry, Spain doubled its gross domestic product between 1997 and 2006, reaching EUR 976 billion. This growth has attracted a lot of immigrants. As a result, Spain's total population mushroomed from 40 to 45 million in a mere seven years.

Politically autonomous regions

Constitutionally, Spain is a federation of 17 autonomous provinces, each with its own political institutions and parliaments. Much of the decision-making and responsibility rests with regional governments, and so many public services are under regional control. E-government is highly developed in Spain, and offers a vast selection of services for citizens. Further impetus came in 2007, when the electronic ID card was launched. "Today, citizens can file their tax returns or change their official residence online, without ever having to visit a bricks-and-mortar office," said Peter Möhring, head of Marketing and Communications at GyD Ibérica, a wholly owned subsidiary of Giesecke & Devrient, a Munich-based technology provider. "The eID card enables secure authentication," added Möhring. GyD Ibérica (or GDI for short) has been in the Iberian Peninsula since 1987, and serves not only Iberia, but also Malta, Morocco and Israel from its Barcelona offices with around 400 employees. The technology provider's Government Solutions division supplies electronic citizen and health care cards to several Spanish regions.

Financial services: a growth market

Spain's technological leadership also includes financial services. The country boasts one of the world's most advanced payment systems. Almost all card-based transactions are verified electronically and authorized at the time of payment. This has kept the fraud rate very low in past years—and was the reason why Spain only recently began to migrate to the EMV standard. One of the leaders in the EMV card production and personalization market is GDI, the first card manufacturer to be certified by all Spanish payment networks. G&D's Spanish subsidiary is also the market leader in banknote processing—especially when it comes to the number of machines sold. "Spain has the highest number of currency processing systems per capita," stressed GDI Communications head Möhring. "That is a powerful testament to the achievements of GDI's Banknote Processing division." GDI has outfitted both the Royal Spanish Mint and the Bank of Spain with its systems, and serves these customers with a team of over 40 technicians.

Historic ties to Latin America

Spain is an ideal springboard, and not just for the Mediterranean. The former colonial state's cultural and historic ties to Latin America provide a solid strategic platform for transatlantic trade. Many Spanish companies develop businesses in Latin America, and have remade Spain and Madrid, its capital city, into a hub for Latin American business relationships.

Telefónica is the leading telecommunications provider in Latin America, but it also maintains important stakes in European businesses. GDI supplies Movistar, Telefónica's mobile phone brand, with high-end SIM cards and has also established a technical task force for developing and testing innovative services based on SIM card technology. A similar program exists with Vodafone.

Ready for tomorrow

GDI recently set up a research and development center in Barcelona. Its expertise is multifaceted, ranging from developing card applications and personalization software to card operating systems and other smart-card-related products. Together with Spanish IT service provider Acotec, GDI has developed solutions for La Rioja, Spain's best-known wine-growing region. Here, information about wine growers and harvests is captured electronically using a smart-card-based solution and then analyzed with software. High technology has thus made inroads into the traditional industries of Spain, too.

More information

Spanish economic data
http://www.auswaertiges-amt.de/diplo/de/Laenderinformationen/Spanien/Wirtschaft.html

German Office for Foreign Trade – Spanish economic data in brief (Nov 2007)
http://www.bfai.de/DE/Content/__SharedDocs/Links-Einzeldokumente-Datenbanken/fachdokument.html?fIdent=PUB200711198010

Economist: Spain’s Economic Structure
http://www.economist.com/countries/Spain/profile.cfm?folder=Profile%2DEconomic%20Structure

OECD: Economic Survey of Spain 2007 http://www.oecd.org/document/9/0,3343,en_2649_201185_37919177_1_1_1_1,00.html