A change in methodology has resulted in Spain’s GDP for 2013 rise by over €26 billion, with €9 billion being as a result of the inclusion of a contribution from illicit activities such as prostitution, drug trafficking and smuggling.
The inclusion of illegal activities – the underground economy – is just a small part of the methodological changes introduced by the INE, which now registers military, research, development and innovation spending as an investment rather than a cost, as was previously the case.
This rise in GDP as a result of the new statistical rules, known as SEC 2010, will have a direct impact on the measurement of certain economic indicators, such as the public deficit and public debt, and these serve as a guide for the European Commission when it comes to determining if European Union states are successfully working toward balancing their budgets.
Estimation of the value that drug trafficking contributes to Spain’s economy is by taking into account the quantity of narcotics seized by the police, and using that figure to calculate the total impact the production and sale of illegal substances has on the economy. The smuggling figure is similarly calculated.
When it comes to prostitution, the calculation is based on the number of people working in the country’s brothels.