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27th-Aug-2014

Spain, Germany defend EU austerity, economic reforms

By AFP, Madrid

The leaders of Germany and Spain on defended the need for structural reforms and austerity measures in Europe, saying they were good for growth, despite calls France and Italy for a shift in economic policy.
"We must continue with policies of fiscal consolidation," Spanish Prime Minister Mariano Rajoy told a joint news conference with German Chancellor Angela Merkel in his northwestern home city of Santiago de Compostela.
"The public deficit and debt levels must be reasonable," he said before adding that the 28-nation European Union must continue to pursue economic reforms to revive the economy.
"Structural reforms are sometimes hard, they are sometimes difficult and complicated to explain but they are the ones that boost economic competitiveness and levels of well being and wealth and jobs," he said.
Merkel and Rajoy have been allies in steering Spain out of a recent financial crisis which threatened the whole eurozone, and in stabilising the finances of the heavily indebted country.
Rajoy passed painful economic reform measures under pressure from Germany and other European partners, which sparked noisy street protests against his conservative Popular Party government.
His government can claim to have overseen an improvement in Spain's economy, which emerged in mid-2013 from a double-dip recession sparked by a 2008 property crash, and is now enjoying a gradual pickup in activity.