SPAIN on Friday raised its forecast for economic growth this year and next, in contrast with countries like Italy and France that are lowering their outlook.

    Spain has emerged from a deep recession marked by a banking crisis, soaring unemployment and a prolonged property market slump as one of the best-performing economies in the eurozone this year, thanks in part to rising exports.

    However, the Spanish Government tempered expectations for a year-end upturn, as a recovery in domestic demand was offset by a slowdown elsewhere in the eurozone. Inflation has been stubbornly low through the region, France’s economy flat-lined in the second quarter and Germany’s contracted in the period.

    The Spanish Government also announced Friday a cautious draft budget for next year, still tending towards austerity. It did not increase spending, even though it faces a general election in 2015. Pensions will rise by a minimum of 0.25 percent, but the civil service is still effectively shrinking.

    The cautious approach on spending comes amid warning signals about the strength of the recovery.

    Spain raised the economic growth outlook for 2014 to 1.3 percent from a previous forecast of 1.2 percent. That was slightly less than forecast around 1.5 percent growth by Economy Minister Luis de Guindos in July.

    For 2015, it is now projecting gross domestic product will grow 2 percent, up from a previous forecast of 1.8 percent.

    (SD-Agencies)