After a few years in the intensive care unit, foreign investment in Spain grew by 8.8% in 2013, achieving a total volume of investment of over EUR 15,800 million. The investment flow was particularly focused on the following four sectors: finance and insurance (EUR 3,140 million), the manufacturing industry (EUR 2,641 million), real estate (EUR 1,787 million) and the building sector (EUR 1,437 million).
The figures regarding the real estate and building sectors are especially relevant, given the fact that both sectors were severally hit by the financial (and economic) crisis that Spain suffered after the collapse of the real estate bubble in 2008.
On the other hand, the manufacturing industry seems to not (yet) have attracted foreign investment. Despite being in second place among the aforesaid sectors, last year the investments made in the manufacturing industry decreased by 38.5% in comparison to 2012.
Regarding the foreign investment trends of the last year, it should be noted that the volume of investments made clearly shows a high degree of concentration; this could be related to the so-called “headquarters effect”, which states that the distribution of the investment directly depends on the location of the central offices of a company. Thus, Madrid and Catalonia were the Spanish regions where the biggest part of the investment flow (more than 75%) was concentrated, given the fact that most of the companies are located there.
Finally, the positive trends described above are also related to the decrease of the divestment process that helped to reduce the capital outflows that occurred in Spain in the past months. This, together with the important contribution of the foreign investment in public debt in 2013 (which set a record at the end of last year), seems to suggest that investor confidence in the Spanish economy has been restored.
