Madrid - Spain's gross domestic product (GDP) grew 1.8 per cent year-on-year in the second quarter of 2008, down from the 3.8 per cent annual rate for 2007, the National Statistics Institute said on Wednesday.

Quarter-on-quarter growth was only 0.1 per cent. Employment has increased 0.4 per cent within a year.

The institute attributed the low growth mainly to weak domestic demand and problems in the construction sector, the meltdown of which has played a key role in creating an economic crisis after more than a decade of continuous growth. (dpa)