http://atlanticinternationalpartnershipnews.com/2011/05/atlantic-international-partnership-headlinesspains-region-urged-to-stick-to-dificit-limits/Spain’s finance minister has insisted that all 17 autonomous regions cut their budget deficits to agreed levels amid revived concerns among sovereign bond market investors at the nation’s finances.
Elena Salgado, together with Carlos Ocaña, the budget secretary, and other senior officials, met regional finance ministers in Madrid on Wednesday evening to implore them to comply with a deficit limit of 1.3 per cent of gross domestic product in 2011 and to map out austerity policies for the following three years.
Spain has regained credibility in the bond markets but was able to meet its overall 2010 public sector deficit target of 9.3 per cent of GDP only because the central government performed better than planned.
Nine of the 17 regions, by contrast, exceeded their deficit limits last year.
In 2011, the overall Spanish deficit is supposed to fall further to 6 per cent of GDP as Spain attempts to differentiate itself from weaker “peripheral” eurozone economies such as Greece, Ireland and Portugal, which have accepted financial rescue packages from the European Union and the International Monetary Fund.
But the newly elected Catalan nationalist government in the Catalonia region of eastern Spain – with an economy the size of Portugal’s – has already said it cannot meet its 2011 target, even after drastic cuts in public spending. Other regions are struggling.
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