Wendy WilliamsSPAIN has vowed it ‘won’t follow Portugal’ in asking for a bailout.
Elena Salgado, the Spanish economy minister, has reassured investors that the country – which has the fourth largest economy in the euro zone – will not follow its ailing neighbour.
She announced on national radio that the need for outside help “is absolutely ruled out” because the Spanish economy “is more diversified, more powerful with sound basics, and is much more competitive” than Portugal’s.
Her confidence was lifted by a 4.1bn euro sale of Spanish government debt, suggesting the markets do not immediately fear contagion.
The news comes just a day after Portugal became the third European Union country – after Greece and Ireland – to formally request an emergency bail–out.
Addressing the nation last night Portugal’s caretaker Prime Minister Jose Sócrates, said: “I have always said that asking for aid would be the final way to go, but we have reached the moment.”
It is understood that the rescue fund could be as high as 80 billion euros.
But for the moment few economists believe Spain is next in line.
Earlier this week Spain was given the backing of the International Monetary Fund.
Dominique Strauss-Kahn, head of the IMF, said: “I don’t believe that the Spanish government needs any type of financial aid.”
The comments will be seen as a vote of confidence that austerity measures imposed by Madrid could be working.
Nevertheless, Spain faces extremely difficult times in the years ahead with unemployment still standing at 20 per cent.
What a load of propoganda. Still trotting out the lie on unemployment – for 20% read closer to 27% average over the whole country and that’s without the 5 million Jobsworths.
The the big bad elephant in the room does’nt get a mention – 1.3 million unsold junk apartments still valued at 2007 fairytale pices.
€2.5 Trillion personal debt, far and away the biggest in the EC and now the ECB raises interest rates to 1.25% and rising. It’s time the ordinary Spanish people learned to look outside Spain, instead of burying their heads.
All it will take is Greece or Ireland to say stuff the bankers debts and default – game over for the Euro (which only the career politicians wanted anyway)and the breakup of the EC into two virtually seperate halves.
With oil at it’s present level, inflation will take off – distribution costs can only soar in a country with a large land mass and still the moneymen talk about growth, still the Spanish really did enjoy the last hurrah of the consumer society.
When business slows down in Spain they put their prices up. With a mentality like that, there’s no way out of the crisis … and they don’t know how to do anything except build ugly flats and pick olives. They don’t appreciate the funds foreigners and the EU provide. They have a pretty bleak future for sure and it’s only a matter of time before Spain looks for the big bailout too.