Spain Ready to Accept Eurozone Bailout: EU Officials

Press TV
Spanish officials are ready to request for a euro zone bailout to help the country pay its debts, European officials say.

“The Spanish were a bit hesitant but now they are ready to request aid,” said a senior European official on condition of anonymity on Tuesday.

On Monday, the European Union Economics Chief Olli Rehn called on Spanish officials to immediately accept the EU bailout to repair the country’s deficit-laden finances.

“The choices will only get harder if they are postponed,” he added. 

With an unemployment rate of nearly 25 percent, Spain is under pressure to get its public finances on track amid concerns in the markets over the state of the country’s banks and the wider economy.

The Spanish government has also been sharply criticized over the austerity measures that are hitting the middle and working classes the hardest.

The 2013 budget will freeze public sector salaries for the third year in a row and cut ministerial spending by an average of 8.9 percent. The country’s regions, which pay for health and education, must also scrape up seven billion euros in savings.

The government has confirmed that it will create a new fiscal watchdog to monitor the budgets not only of the central government but also the regional and municipal ones to make sure they comply with Madrid’s efforts to control spending and cut the country’s deficit.

On Friday, hundreds of Spanish nurses, policemen and other public workers took to streets near the Budget Ministry in Madrid to protest against having their pay frozen for the third year.

Battered by the global financial downturn, the Spanish economy collapsed into recession in the second half of 2008, destroying millions of jobs.

Spain, Greece, Italy, Cyprus and Portugal are all in recession and all five are receiving financial assistance from European bailout funds.