Spain's Prime Minister says no further spending cuts planned

22 Nov, 2010

Spain has no plans for more spending cuts on top of May's austerity measures, Prime Minister Jose Luis Rodriguez Zapatero said in an interview with El Pais newspaper on Sunday.
The government implemented a 15 billion euro ($21 billion) austerity package six months ago, including civil servant salary cuts and scrapping bonus payments to new mothers, in an attempt to deflect fears Spain was heading for a debt crisis.
ECB Executive Board Member Jose Manuel Gonzalez Paramo said on Friday Spain's reforms were enough to protect it from contagion from debt crises elsewhere in Europe, although he said also that any extra steps taken by EU states would be welcome.
Markets have started to differentiate Spain from other potential eurozone trouble spots such as Portugal and Ireland, which is thrashing out a multibillion euro international aid deal to support its massively indebted banks.
Spain drew solid demand for 3.6 billion euros of long-term debt on Thursday, showing buyers took a relatively positive view of Spain's prospects after measures taken this year including labour reform and an overhaul of the country's banking system.

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