James BryceSPAIN has had its credit rating downgraded amid warnings that the recession is likely to deepen by the end of the year.
Standard & Poor’s lowered its rating two notches from A to BBB+ in a move that is expected to drive up the cost of borrowing.
The rating agency has already downgraded Spain once this year and warned that it may be forced to lower its rating further if the situation fails to improve.
Investors are becoming increasingly worried over the Spanish government’s ability to cut spending without sending the economy further into recession.
Spain is now viewed as the most vulnerable country in the eurozone, and is looking ever more likely to have to accept a multi-billion-euro bailout.
It comes as the Spanish central bank confirmed this week that Spain is in recession for the second time in three years.
There was further bad news as it was announced Spanish unemployment has hit a record high, according to official figures.
The unemployment rate hit 24.4 per cent at the end of March, with 5,639,500 people out of work.
Foreign Minister Jose Manuel Garcia-Margallo said: “The figures are terrible for everyone and terrible for the government. Spain is in a crisis of huge proportions.”
And the band plays on….We all knew this was coming but still the Spanish government continued to allow the regions to spend spend spend on airports that will never open and such like. These people are so layed back they are almost horizontal. There is a saying “live and learn” DON’T “crash and burn”.
Of course, a lot of the ‘unemployed’ still work on the black market for cash in hand … you can never believe any statistics from the Spanish govt, they’re normally lies anyway.
I’m not a fan of statistics either as and yes the figures recently quoted in the press are lies. These people hide so much in order to buy themselve time to get themselves out of a mess but all they do is get themselves into mess until they are at the point of no return and still they say no we are fine and doing well…It’s a joke.
It’s not just the Spanish unemployed who are working on the black market in Spain, a lot of brits are doing the same to survive, while they are living in spain they are avoiding paying tax. It’s going to get worse before it ever gets better. It’s unfair on the honest people both Spanish and brits.