terça-feira, 15 de fevereiro de 2011
TEc "Reforming Zapatero" - Spain's tough predicament is not insurmountable
Spain has taken a very hard knock from being one of Eurozone's star performer to a laggard barely scraping by.
This is the result of a single sector - the construction industry - having swollen to account for over 12% of GDP. Excessive supply giving rise to a bubble set to burst anytime. Only brought forward by the US triggered financial meltdown that then gutted Europe's financial sector and economy.
Spain is not an overly indebted country, which should a priori spare it from the perils of the sovereign-debt crisis.
Indeed when the word contagion is used nowhere does it find fuller meaning than in Spain's case.
That being the logic of the system - pointless to blame anonymous investors worldwide - there remains little else for governments to do besides balancing public accounts and promoting economic growth.
Spain's business community leading its large and diversified production base must now seize the moment to propel forward every sector across the full spectrum of the economy.
There won't be changes overnight but it will pay off in the longer run. It may just be that Spain's return to meagre growth in 2011 signals the bottoming out of 2 very harsh recessive years.
Policy-related structural adjustments should be pushed through by politicians to put Spain's growth on sounder footing.
And to bring down that shameful unemployment statistic.
As soon as healthy growth resumes to deftly dodge a future recurrence of the type of bottleneck Spain was squeezed into as a result of multiple factors.
I was never in any doubt that Espana can do much better than that.
Hopefully it will with or without Zapatero at the helm.