News Column

IMF Urges Spain To Take Additional Reforms To Address High Unemployment

July 10, 2014

MADRID (Alliance News) - The International Monetary Fund welcomed positive developments in Spain's labor market but called for additional reforms to improve the condition.

High unemployment remains a pressing challenge, the Executive board of IMF said late Thursday. The lender noted that unemployment, at 26%, remains unacceptably high, with the majority of the unemployed without a job for at least a year.

Directors also highlighted that additional measures toward flexible wage setting at the firm and sector level would make the labor market more inclusive.

Directors stressed that labor market reform should be accompanied by product and service market liberalization to maximize the gains to growth and jobs.

While acknowledging Spain's commitment to fiscal consolidation, directors recommended further improvements to spending efficiency, and enhancing the proposed tax reform to boost employment through cuts in social security contributions and increasing indirect tax revenue.

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Source: Alliance News

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