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Spanish report Spanish report
by Euro Reporter
2011-09-10 08:05:44
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Next PM bares his soul

Mariano Rajoy, who is likely to become Spain’s next prime minister, has made a number of intriguing revelations in his memoirs, strategically released just a few weeks ahead of the general election on November 20.

In line with most campaign memoirs, it’s not a rollicking read, but it does have its highlights. Here they are, stripped of the padding:

Structural reforms: he likes them. One can get a list of the kind of things Conservative policymakers say they favour, and tick away with abandon–job creation, budget moderation, and support for entrepreneurs. There are few specifics, other than the idea that he plans to make Spain’s labour market, among the most rigid in the developed world, more flexible so that companies can hire and fire more easily.

Sovereign debt crisis: he doesn’t like it. Unsurprisingly, he blames the arguably very slow response to the 2008 property bust by current PM Jose Luis Rodriguez Zapatero for Spain’s tricky predicament. But he vows to do whatever it takes to keep Spain in the euro, solvent and un-rescued by the Germans. No hint of euroskepticism here.

Optimism: he’s all for it. After local headlines were dominated this week by the debate on how close Spain was to a bailout last month, Rajoy does sound bullish: he reminds the reader that in 1996, when his Popular Party first took over the government from the Socialists, doom and gloom were all over. Over the next eight years, Spain made it into the euro without cheating and created 4.5 million jobs. In the 20 years before 1996, he says, zero jobs had been created in Spain.

Immigration: in a cautious foray into one of the biggest debates in Europe, Mr. Rajoy believes that low-fertility Spain needs more foreign arrivals, but under strict control. He castigates Mr. Zapatero’s amnesties of illegal immigrants, which were fairly controversial in recent years. He has this to say about the U.K. and French ways of dealing with the issue: they don’t work.

Anybody care about Spain’s stance on Turkey’s candidacy to join the E.U.? Mr. Rajoy sounds lukewarm and is clearly not the biggest fan of the idea. That may have to do with the fact that Turkey’s PM Tayyip Erdogan is something of a pal of Mr. Zapatero’s, and the main international promoter of Mr. Zapatero’s fairly useless talk shop, the grandly named Alliance of Civilizations. That “Alliance,” by the way, looks doomed to fall victim to budget cuts in due course.


Back to school in a grumpy mood

The mood in Spain's classrooms is dark as the new school year gets under way, with public school teachers furious over austerity measures they fear will sap the quality of education. Thousands of teachers, parents and students marched through Madrid Wednesday night to protest personnel cuts. Teachers also plan to demonstrate in other regions such as Navarra in the north, Galicia in the northwest and Castilla-La Mancha in central Spain.

Education is mostly run by regional governments, many of which have hefty deficits. Under pressure to cut costs, they are ordering teachers to spend more hours in the classroom this year. Unions say that means thousands of backup teachers will be axed. In Madrid, a strike has been called for the opening day of public secondary day schools Sept. 14.


Spain sees no big hit from wider slowdown

Spain's economy may suffer slight impact at most from the slowdown in other countries, and the government is not revising its growth outlook for this year, Economy Minister Elena Salgado said on Thursday. Salgado told a news conference the country's nominal GDP is on target, and that the government was sure to fulfil its pledge to hold the public deficit to 6 percent of gross domestic product this year.

Spain's commitment to slashing its deficit is part of euro zone efforts to emerge from a prolonged debt crisis that has seen government borrowing costs soar. Salgado kept to the government's outlook for 1.3 percent economic expansion this year although noting that European economic data had been disappointing.

"We are not going to revise our growth outlook... but we can't rule out that this general slowdown will affect us slightly. I insist, slightly," Salgado said. Spain's economy expanded 0.7 percent in the second quarter, compared with the same quarter last year, and manufacturing data for the beginning of the third quarter has been lacklustre.

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