Mariano Rajoy believes his austerity efforts have made sense and that the country can hope for better things in 2014
More than half its young people are unemployed, a double-dip recession has left the economy 7% smaller than it was five years ago, and debt has soared to nearly 100% of GDP. But Spain's prime minister, Mariano Rajoy, believes his country has turned the corner and can hope for better things in 2014, following its worst economic crisis since the Franco era.
In an interview with the Guardian and partner newspapers from Spain, Italy, France and Germany, Rajoy said the incipient turnaround proved that his austerity efforts "have made sense".
"Last year, the debate was over when Spain would get a bailout, and this year the debate is over when Spain will recover," Rajoy said. He based his optimism on recent unemployment figures which showed that the number of jobseekers had fallen in November for the first time, following positive signs in October.
"Since June 2007, the difference in the unemployment numbers for the corresponding month of the year before has been getting worse and worse and worse. There was a moment, in 2009, when comparing January 2009 and January 2008, one million extra people had registered as unemployed," he said.
"But now, for the first time, in October this year, this trend changed, and there is less unemployment than a year ago. And in November, this trend has been maintained," he added, with around 2,500 fewer people registered as unemployed last month.
"Am I satisfied with this? No. I'm not satisfied … but it is very important, because it shows that there is hope and that this country can and will move forward and that all the efforts that have been put in have made sense," said Rajoy.
Not so long ago, there were real fears that Spain could turn into the next Greece – with far greater implications for the euro and EU economy because of its greater size. The impact of the economic crisis is writ large across the nation: in the empty housing estates that were never completed as the construction boom ground to a halt, the pensioners protesting after their life savings were swallowed up by failing banks, and the vast numbers of young people moving abroad to find work.
But Rajoy thinks that the country has finally turned the corner, highlighting Spain's export industry, which has seen shipments abroad increase steadily over the course of the past year. Spain's powerful car industry is getting back on track, and foreign investors are returning, bringing with them the hope that the country can emerge from its recession.
Rajoy has been criticised for imposing strict austerity measures on Spain, which he argues have brought stability to a country that last year came close to a national bailout, but have seen unemployment spiral, particularly among the young, and deep cuts made to public services.
"It's evident that today there are far fewer people working than five years ago, that is to say that since 2008 things have not gone well in terms of employment. Logically, these people are experiencing difficult times, but it's also true that in Spain there is a very important safety net, namely public services, unemployment benefit … which have allowed people to attain a dignified standard of living," said Rajoy. He spoke of his dislike of raising taxes, but said that he had tried to be as fair as possible in doing so. "It's true that times of crisis generate great difficulties, but this crisis has generated problems for everyone," he said.
Many are worried about the kind of Spain that will emerge from the recession, in a country with one of the biggest wealth gaps in Europe, with the rich getting richer while the working and middle classes are left with rising debts, fewer public services, reduced salaries and more precarious employment.
Rajoy's government carried out labour market reforms in 2012 that made it easier for companies to fire staff, and to bring in more part-time contracts, and the prime minister said there were plans to introduce further such changes. But critics say these reforms fail to achieve what they set out to, namely to create jobs.
Rajoy defended the reforms, saying they had helped to stabilise employment. "In difficult times, it is better to go for lower salaries and to maintain the highest number of people in work," he said. "I would prefer full-time contacts, of course … but short-term contracts can help people out."
Not everyone is as hopeful as the prime minister. A report from PricewaterhouseCoopers last week suggested that Spain's economy would not recover for two decades, and would continue to experience high levels of unemployment throughout that time.
SpainMariano RajoyAusterityEconomic recoveryEconomicsGlobal economyItalyFranceGermanyGlobal recessionGreeceEuropeAutomotive industryYouth unemploymentEurozone crisisYoung peopleUnemploymentEuropean UnionPaul Hamilostheguardian.com © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds |
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