Zapatero says ready for tough austerity measures

LONDON, April 12 (BestGrowthStock) – Spain will implement its tough
austerity package “whatever the cost” Prime Minister Jose Luis
Rodriguez Zapatero told the Financial Times in an interview
published on Monday.

With Greece battling a debt crisis that investors fret
could spread to Spain, Zapatero is tasked with convincing
investors it can tame a budget deficit that reached 11.4
percent of gross domestic product in 2009 while avoiding social
conflict.

“We have a plan, a credible quantified plan which we have
already begun to implement, a plan to reduce the public
deficit,” Zapatero told the FT.

“What we have to be judged on in the future is whether we
gradually do implement all the different items included in that
plan. We will certainly do so whatever the cost.”

“If we have to make more cuts or demand more austerity than
we will do it,” Zapatero said.

Spain has promised to slash its public deficit to the EU
guideline of 3 percent of GDP by 2013. Central to achieving
that will be a 50 billion euro austerity plan which will
include a hiring freeze for the public sector of 4 percent.

When asked about labour market reform Zapatero said this
was “essential” and that talks had started between business
leaders and trade unions, key allies of the socialist Prime
Minister.

“(W)e are doing this most intensely and we want to reach an
agreement that includes more flexibility while preserving
guarantees and rights of employees,” he said.

Job creation is a key challenge with government forecasts
predicting 19 percent of the working population will be out of
work this year.

But Zapatero remained optimistic that Spain, the euro
zone’s fourth-largest economy, would overcome its financial
difficulties.

“Spain is not going to fall back into the second division.
Yes, times are difficult, but we will be in the first division,
with the strong countries,” he said.

Stock Market Report

(Reporting by Caroline Copley; Editing by Diane Craft)

Zapatero says ready for tough austerity measures