“The longer the crisis goes,” Mr. Agudo said, “the harder it will be to live off the past.”
It may be time for Spain to look to a different future. The country’s love affair with building made construction a signature industry, even larger as a share of the economy than it was in Germany in the early 1990s, when the rebuilding of the former East Germany was under way.
But now, with the industry in tatters, Spaniards are re-examining the sustainability of their once-thriving economic model.
On Wednesday, the prime minister, José Luis Rodríguez Zapatero, called an emergency cabinet meeting to consider responses to an economy that is facing a stream of bad news.
Data released the same day showed that inflation rose to 5.3 percent in July from a year earlier, the highest level in 15 years, additional evidence that prices are soaring.
“We cannot just grow from real estate and construction,” said José Manuel Campa, a professor of finance at the IESE Business School of the University of Navarra. “We need to produce goods and services that we can sell to the rest of the world.”
“The question is,” Professor Campa asked, “can you build that up in the next 18 months?”
Probably not, which is why Spain is likely to feel the brunt of the current economic downturn. Not only did it play the housing game to the fullest, but its quandary has been exacerbated by the global financial vortex that has only seemed to gather speed.
New housing starts peaked at over 900,000 in 2006, but home building in Spain is likely to fall to about half that level this year, the country’s minister of economy and housing, Pedro Solbes, said recently. Home prices fell 4 percent in the second quarter, and most economists say that they expect years of stagnation.
Unwinding that imbalance, economists say, would be painful enough even in the best of times. But gyrations on world financial markets have raised the cost of the adjustable-rate mortgages that most Spaniards chose.
“It is getting far worse than we would have expected at the beginning of the year,” said Julián Cubero, chief Spain economist at Banco Bilbao Vizcaya Argentaria, one of the largest Spanish banks. “We’re suffering a perfect storm.”
Mr. Zapatero belatedly used the word “crisis” to describe the country’s situation last month, touching a nerve with Spaniards who have not suffered a significant economic recession since the big downturn after the Barcelona Olympics in 1992.
“There was a state of denial,” said Roger Cook, managing director for Spain at Cushman & Wakefield in Madrid. “There was not an appreciation that this was not a slowdown, but a serious crisis.”
Here on the Costa del Sol, where business leaders say that they expect flat or declining business through the end of 2009, the sun is still shining. But the outlook is decidedly cloudy.
Synonymous with tourism, the Costa del Sol runs along a strip of the Mediterranean that begins east of Málaga and ends near Gibraltar.
Its natural attributes in the summer are stunning. Azure seas wash up on grayish sandy beaches, or lap against rocky outcroppings. Mountains colored a soothing ochre but punctuated by deep-green vegetation seem to leap upward from the ribbon of land that leads to the water, all beneath a sky unacquainted with clouds.
But the region is also a monument to bricks and mortar.