spanish property boom

China and Spain Sign Business Deals worth US$3.8 Billion and Spanish property is set to boom.

When the history of 2014 is written, it will take note of a large fact that has received little attention: 2014 was the last year in which the United States could claim to be the world’s largest economic power. China enters 2015 in the top position, where it will likely remain for a very long time, if not forever. In doing so, it returns to the position it held through most of human history.

Comparing the gross domestic product of different economies is very difficult. Technical committees come up with estimates, based on the best judgments possible, of what are called “purchasing-power parities,” which enable the comparison of incomes in various countries. These shouldn’t be taken as precise numbers, but they do provide a good basis for assessing the relative size of different economies.

Early in 2014, the body that conducts these international assessments—the World Bank’s International Comparison Program—came out with new numbers. (The complexity of the task is such that there have been only three reports in 20 years.)

The latest assessment, released last spring, was more contentious and, in some ways, more momentous than those in previous years. It was more contentious precisely because it was more momentous: the new numbers showed that China would become the world’s largest economy far sooner than anyone had expected—it was on track to do so before the end of 2014.

In October 1, 2014 – Chinese Premier Li Keqiang and Spanish Prime Minister Mariano Rajoy have signed business deals worth approximately US$3.8 billion in a bid to boost bilateral cooperation and economic growth. On September 25-2014, 14 agreements were signed between the two parties at a ceremony in Beijing’s Great Hall of the People, covering cooperation in areas including the film industry, nuclear power, telecommunications, finance, wind power, sea water desalination and tourism. Rajoy further urged that the two sides strengthen cooperation in the food and consumer industries, adding that few countries offer such a good investment environment as Spain with its open and competitive market.

Companies which attended the meeting included Spain’s largest bank, Banco Santander (SAN.MC), Zara and Chinese e-commerce magnate Alibaba Group Holding (BABA.N). Among the attendees, Huawei, the world largest telecommunication equipment maker, signed a cooperation agreement with Spanish telecommunications juggernaut Telefonic. Four of the 14 deals were signed in the field of energy, including a contract to supply China with nuclear safety products.

Li stated that the Chinese government attaches great importance to its relations with Spain and urged the two sides to continue expanding bilateral trade and accelerate growth. He also mentioned that the two countries should strengthen cooperation in areas such as energy, finance, biological medicine and the aerospace industry.

Chinese companies are highly encouraged to invest in Spain, and Spanish Property Li said, and he recommended that Spain provide more legal and policy guarantees, as well as Golden Visa measures, to promote this.

Speaking on E.U.-China relations, Li clarified that China will continue working together with Spain to implement the China-E.U. 2020 Strategic Agenda for Cooperation. Rajoy’s visit, aimed at attracting Chinese investment into Spain, makes him the most recent European leader to visit China.

The Spanish economy is now back on track after the eurozone crisis and grew at its fastest pace in six years in the second quarter of 2014, making the country one of the few recent economic success stories in the eurozone. Rajoy announced that Chinese tourists are welcome in Spain and will be able to complete visa procedures within 48 hours.

Despite slow recovery in the world economy following the 2009 financial crisis, economic relations between China and Spain are booming. According to official data, China is the biggest trading partner of Spain outside of the E.U. In 2013, bilateral trade totalled US$24.9 billion with a 1.4 percent growth rate; and in 2014, from January to July, this had reached US$15.8 billion, growing at a rate of 14 percent. For the year of 2014, foreign direct investment from Spain into China amounted to nearly US$167 as of August, according to Capital Vue.

H&G has access to some of the best BMV (Below market value) property available in Spain. In order to be in-front of the curve the time to invest in Spanish property is now.

The H&G BMV (Below Market Value) property portfolio offers an alternative to clients tired of investing their hard-earned money into the usual equities and corporate bonds, all of which have an almost pedestrian return these days. The H&G BMV property portfolio is aimed at investors who require a higher and sustainable level of income and for clients who have been frustrated in recent years with low interest rates and fluctuating performance from equities and corporate bond funds.

Indeed, one of the concerns that many investors have is that their investments are concentrated on very few types of assets all linked to the volatility of stock markets – leading to a feeling that they have put all of their eggs into one basket.

H&G focus on BMV properties with large upside potential in Spain and her associated islands, specifically high income-producing flats, apartments, complexes and villas not linked in any way to the stock market. H&G, therefore, are confident that all of our Chinese clients will find something to suit their needs within our portfolio.

Investment in property is not a new concept for most investors. The difference is that an H&G property provides a real ‘Free Hold’ asset since the investment is tangible, being bricks and mortar. Furthermore, you have equity built into the purchase from day one.

Our advice is thus; get into the Spanish BMV market today. Grab a bargain now and simply hoover up the rental yield in the short term, the Spanish holiday market is still booming, good property always rents. Sooner or later your Chinese friends will turn up with hard cash, looking for a great investment. If you have bought a property at say 35% BMV, you could sell it to your new Chinese friend at a discounted price and still make a very healthy profit based on predicted market value and physical market movements.

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