Power price surge threatens Spanish recovery2021|01:46
Surging natural gas prices across Europe could hinder an economic recovery in Spain. Energy bills have more than doubled in European countries as gas prices rocket. It's due to low storage stocks and other factors. And has tipped companies into crisis, forcing governments to help cushion the blow. Analysts say Spain is particularly exposed to the spike in household fuel bills due to many being on flexible tariffs. With small businesses particularly exposed to the pain. They account for over 61% of Spanish economic activity and 71% of total employment. Mayra Maldonado runs a dry cleaners in Madrid: "This has affected us a lot because our machines have to be working at all times." she says. "We can't depend on a timetable and this affects us because our machines use up a lot of energy and we can't find another way to do things. We have no benefits, government subsidies or company discounts." Maldonado worked through an August heatwave with hardly any air conditioning in an effort to keep down bills. Spain's gross domestic product shrank a historic 10.8% in 2020. Recent indicators pointed to a solid revival of the economy. But the recovery so far has been heavily dependent on spending by consumers who are now facing 35% annual rises in their power bills. The Bank of Spain, in line with the European Central Bank, insists the rise is temporary and will not affect the economy. Last week the government introduced an emergency package, reducing taxes and putting a cap on gas prices. Italy and Greece face similar problems, and are eyeing measures. But for some small businesses already battered by lockdowns, it may be too little, too late.