Page 45 - economic report 2021

indicated a year-on-year increase of 7.9% in
average turnover and 2.8% in investment, BUSINESSES’ OPINIONS OF ECONOMIC Table 5.4
contrasting with the steep reductions seen DEVELOPMENTS IN 2021
in 2020. The level of occupancy, level of
reservations and prices also improved. Results of the situation survey in hotel sector
2021 COMPARED WITH 2020 (as % of businesses)
Commerce followed a similar pattern to
tourism, with a still gentle recovery in business Turnover Higher 51
15
Same
activity. The positive trend can be seen in the Lower 34
increase in the number of establishments and Average variat on (%) 7.9
electricity consumption and slower decline Volume of investment Higher 28
in the volume of imports without fuels. Same 55
Moreover, the Chamber’s surveys showed an Lower 18
improvement in business activity and increases Average variat on (%) 2.8
in sales figures (10%) and investment (6.8%). Number of employees More 41
However, the sector has continued to reduce Same 56 3
Less
the number of employees.
Source of clients per Direct client / own web 26.0
sales channel (as %) Internet / booking sites 53.2
In the case of financial, real estate, professional TO & travel agencies 15.5
and technical activities, the recovery was quite Others 5.3
strong, with an estimated increase in GVA of Average stay of clients (nights) 2.6
9.1%, after the 3.9% decline recorded in 2020.
Remember that this branch of services is the Prospects for 2022 (as % of businesses)
most important in the economy, with almost Trend in turnover Upward 72
36% of total GVA. Stable 21
Downward 7 43
The trend in the banking sector in 2021 was Trend in volume of Upward 59
quite favourable, with aggregate growth in investment Stable 37
profits of all the national institutions of 16.5%. Downward 5
This increase was accompanied by notable
increases in both gross lending to clients Source: Chamber of Commerce, Industry and Services of Andorra.
(10.4%) and deposits (9.8%). The banking
sector profits were favoured by the strong Andorra’s banking sector
recovery seen in the economy, in a context recovered strongly, with double-digit
that was still marked by low interest rates in
2021. Altogether, this put return on equity growth in lending and prof ts.
(ROE) of the banking sector at 6.04% in 2021,
higher than the 5.46% of the previous year, while the default rate dipped to 3.74% and solvency
levels were maintained (17.0% CET1 phase-in).

Despite the improvement in profits, the number of employees in the banking sector shrank 2.9%,
according to data provided by Andorran Banking, and the number of branches also shrank 5.1%.
Now, in the Andorran financial sector as a whole, the number of employees saw a slight increase of
0.4% and the average monthly wage rose 1.2% after two years of decline. The Andorran economy: general developments | V. Activity and demand

To complete the sectoral analysis, in 2021, the primary sector – which only contributes 0.5%
of total GVA – saw contraction for the fourth consecutive year, of 0.6% which, nevertheless,
was smaller than that of 2020 (-4.9%). This decline was accompanied by a fall in the number of
employees (-1.5%), number of establishments (-3.4%) and numbers of livestock (-2.8%). In contrast,
the utilised agricultural area increased 1.8%, interrupting four consecutive years of downward
trend. As for the tobacco harvest, the trend in 2021 was for partial recovery, with an increase of
14.6%, after two years in an exceptional situation caused by COVID-19.