Brussels, 23/03/2015 (Agence Europe) - The representatives of Spain's creditors noted that the economic situation in Spain is constantly improving and flag up the need for the reforms to continue through to the end, particularly on the employment market, in order to boost growth.
“The economic recovery strengthened further towards the end of 2014, with GDP growing at a faster pace than the euro area average. Reforms introduced since 2012 have contributed to the improved prospects in the labour market, further easing of financial conditions and enhanced confidence”, the European Commission and the ECB reported on behalf of Madrid's creditors, following a post-programme surveillance visit on Monday 23 March.
However, the two European institutions note that further debt reduction in the private sector is needed and that unemployment - particularly youth unemployment - remains “very high”. In the financial field, stabilisation is continuing, with Spain's creditors calling for the completion of the restructuring and privatisation process of the banks that were nationalised following the burst of the property bubble in 2011. Additionally, the volumes of bank loans to the main market segments “continue to fall”. It is worth noting that the Fund for Orderly Bank Restructuring (known by its Spanish acronym, FROB) has become the Spanish banking resolution authority. As regards reforms, the two European institutions highlight the reforms which need to be fully carried out on the employment market and the functioning of professional associations.
The next post-programme surveillance visit will take place in autumn 2015. (Mathieu Bion)