News Column

Spanish PM Warns of Crisis in 2013

Dec. 28, 2012

Spanish Prime Minister Mariano Rajoy warned his country Friday that 2013 will be "even harder" than the economic pain the country has seen in 2012.

Rajoy, in a rare press conference, said he understood the "impatience and even disappointment" of ordinary Spaniards, faced with a recession and unemployment over 25 per cent.

But he warned: "Without the cuts, the deficit would be at more than 11 per cent, and the situation unacceptable ... who would lend us money then?"

Rajoy said his mix of reforms and austerity cuts had saved Spain from bankruptcy, and expressed the hope that the second half of 2013 would see improvements in the economy.

But the centre-right premier stressed that Madrid had not yet asked for a bailout from the European Union - although it has received some 39.5 billion euros in loans for its ailing banking sector.

"Until now, the Spanish government has not considered such a request as necessary ... for the future, we cannot exclude it," he said.

In 2012, the Spanish economy - the EU's fourth largest - shrank 1.5 per cent, with official outlooks predicting a further contraction of 0.5 per cent in 2013 - although the EU estimates the decline could be up to 1.4 per cent.

Source: Copyright 2012 dpa Deutsche Presse-Agentur GmbH

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