Empire Rising: Spain

Although the economic crisis has been temporarily alleviated, the impact of the economic crisis cannot be resolved in a short period.

The greatest impact caused is the shock to the industrial and economic markets of various countries.

The impact of an economic crisis varies completely based on its causes. Take this crisis, caused by severe overproduction, which has led to a frantic plunge in both industrial output and prices in various countries, most notably in the metallurgical and metal processing industries.

The global demand for steel is gradually increasing, and steel prices are also continuously rising. However, after the crisis erupted, steel prices in European countries dropped by more than half, with some more severely affected countries seeing a decline of over 60%.

Yet, even with such low steel prices, the quantity of steel imported by European countries did not increase much compared to before the crisis.

After the economic crisis broke out, Spain significantly reduced its imports of foreign goods to protect its fragile domestic economy.

Even with countries like Germany lowering their steel export prices to below Spain’s steel production costs, Spain still did not choose to import steel from abroad.

After all, importing steel from abroad would reduce the number of orders domestic steel mills could receive. This would not only affect the business of domestic steel mills but also impact many more enterprises due to the steel mills.

When the economic crisis broke out, all countries tacitly reduced the scale of imports and strived to export more goods.

However, except for countries with small industrial scales that rely heavily on imported materials, other countries would not increase import scales.

These industrial products may be cheap, but they can impact the domestic industry and economy, so these savings are not easily enjoyed, as they would make the industry and economy subject to influences from other countries.

Among many European countries, Spain is rather special. Since it wasn’t too affected by the economic crisis, domestic industrial enterprises in Spain continue to produce uninterruptedly.

After the government announced the second five-year plan, private factories were thrilled, wholeheartedly reassured, and demonstrated more enthusiasm in production work.

Nevertheless, due to the overall decline in prices across Europe, Spain could not avoid lower prices either. So far, Spain’s overall prices have decreased by about 10%, which is already relatively good compared to other European countries.

“Prime Minister Prim, do the current price changes significantly impact various industries?” Carlo asked during a Cabinet meeting about his concern.

Prices, referring to the selling prices of all goods, have a significant impact on the economy. Changes in prices can cause economic fluctuations and even turmoil in an industry.

“There is indeed some impact, but currently it is not too severe and is still acceptable for us,” Prime Minister Prim replied. ”

The most severe price drop is in the metallurgical and metal processing industries, which have been effectively alleviated under government control.

After announcing the second five-year development plan, our country’s prices have somewhat rebounded, and are still at a relatively healthy level compared to other European countries.

However, the prices of industrial products cannot yet return to pre-crisis levels. Currently, the price of steel in our country has dropped by about 15% compared to before the crisis, but due to increased demand, the operations of steel industry factories and enterprises are stable, with no major issues for the time being.”

Prices in Europe are consistently declining, and Spain is certainly not immune.

If Spain’s prices remained high, it would lead to extensive smuggling. Purchasing large quantities of cheap products from abroad and bringing them back to Spain could yield significant profits, prompting many to take the risk.

However, compared to price declines in other countries, Spain’s price drop is somewhat controlled, making the impact less severe.

Though the price drop in the steel industry is relatively large, the overall demand for steel in Spain has been expanding constantly due to the railway construction demands in the second five-year development plan.

With sufficient demand, it means the steel mills have enough orders. Although they earn less than before, as long as there are continuous orders, the steel mills can survive on these slim profits.

Moreover, steel mills are not low-profit enterprises. Originally, their profits were startlingly high. Even with the current low steel prices, steel mills will not go bankrupt immediately.

It’s just that a single order now yields a small profit instead of a large one.

“What about the prices of agricultural products? Has this economic crisis significantly impacted the farmers?” Compared to the industrial sector, Carlo is more concerned about farmers’ income.

With most of Spain’s population being farmers, caring about farmers’ income is essentially caring about Carlo’s throne.

“In this regard, there is good news. The economic crisis has not significantly impacted agricultural products. While the prices of industrial products continue to fall, agricultural product prices have remained relatively stable, overall maintaining pre-crisis levels.” Upon mentioning farmers’ income, Prime Minister Prim smiled and spoke with a smile.