Since the conflict between Russia and Ukraine began, the Spanish economy has proven remarkably resilient, outperforming Germany’s, although Germany is generally considered the engine of Europe. This is what emerges from an analysis carried out by Decalia, a Swiss company that provides consultancy in the management of investment portfolios to both private and institutional clients. This trend also emerged during the 2024 European Championship, in which the Spanish team won the trophy after eliminating Germany, host nationto the quarter-finals.
The degree of energy dependence is one of the main factors behind this different trend. Germany, a large user of Russian gas, has borne the brunt of the sanctions and disruptions to energy supplies. This has led to the increase in production costs and inflation, which in 2023 approached 6%. Spain, on the other hand, in addition to being less dependent on Russian gas, boasts a better mix of energy sources, especially renewables. As a result, inflation is more contained, at 3.5%. Diversifying the game and adapting to the opponent’s strategies also allowed La Roja to win the most important matches of Euro 2024.
The tourism sector, fundamental to the Spanish economy, has seen a strong recovery following the pandemic. In 2023, millions of visitors flocked to the country, driving GDP growth, creating jobs and supporting small local businesses. Although it is also a tourist destination, Germany clearly cannot compete with Spain on this front. To make another comparison from the world of football, the fact that the Spanish national team managed to exploit its strengths, in this case a brilliant attack and a solid defense, contributed significantly to their title as Euro 2024 champions.
Furthermore, while Germany faces some major structural challenges, in particular the aging population and dependence on the manufacturing industrySpain has been able to implement structural reforms to improve the competitiveness and flexibility of its workforce. Promoting innovation, supporting start-ups, improving education and professional training: these are just some of the measures designed to help the country better adapt to the post-Covid economic reality. Just like the Spanish football team has been able to reinvent itself and welcome young talents (Lamine Yamal and Nico Williams come to mind).
In addition to tourism, in recent years Spain has invested heavily in sectors such as IT, renewable energy and financial services. Thanks to this diversification, its economy has better resisted external shocks. Germany, by contrast, remains heavily dependent on its manufacturing sector, which has been hit hard by supply chain disruptions and swings in global demand. Similarly, Mannschaft, despite its talent and prestigious history, has shown signs of vulnerability in the face of more diversified rivals.
Finally, fiscal and monetary policies have also strongly contributed to Spain’s economic resilience. The authorities implemented support measures for businesses and households, including subsidies, tax cuts and employment support programmes, which served to stabilize the economy and support domestic demand. Similar measures were also adopted in Germany, but they were less effective due to the energy and structural factors mentioned above. Likewise, injuries and tactical errors also hindered the German coach’s strategic decisions at the 2024 European Championships.
In short, the German industrial economy, which was once a successful model, now struggles to cope the challenges of the current context. Spain, on the other hand, with its diversified and resilient service model is an example of the ability to adapt to the new post-COVID economic reality. In our opinion, German politicians, like the members of the Mannschaft, should review their strategies and introduce some new talent to move up in the rankings. The Spanish team, meanwhile, will have to continue to shine on the international scene.
