Thursday June 21, 2012
Spain ‘doesn’t need rescue’
MADRID: Spain said it had no need of a full-blown bailout and claimed the support of Europe yesterday even as its borrowing rate hovered near euro-era records.
Fears mounted among investors that rising interest rates could eventually force the eurozone's fourth-largest economy to seek an international rescue like Greece, Ireland and Portugal before it.
“Spain has not been rescued because it does need to be rescued. Spain has the support of its European partners and European institutions,” Budget Minister Cristobal Montoro told parliament.
Spain's eurozone partners agreed on June 9 to extend a loan of up to 100 billion euros (US$125bil) to salvage distressed banks, laden with bad loans extended during a real estate bubble that imploded in 2008.
Prime Minister Mariano Rajoy's conservative government refuses, however, to describe this aid as a rescue or bailout.
“A week ago, Spain was not rescued,” Montoro said.
The minister hailed a Group of 20 (G20) summit in Los Cabos, Mexico, where leaders issued a statement saying they welcomed both Spain's plan to recapitalise the banks and the eurozone's loan.
“What we have to send to the Spanish people is a message of confidence, of calm, of security,” Montoro said. “We are in Europe, we are Europe, we are the euro,” the minister proclaimed.
“From a crisis such as the one we are going through we will emerge strengthening Europe, we will emerge strengthening the euro, we will emerge building a common project, that common project that we saw yesterday (on Tuesday) in the support from the G20 declarations,” he said. - AFP