Spain announced deep cuts to its central government budget on Friday as it battles to convince European partners and debt markets it can rein in its budget deficit in the face of growing public complaints.
The government said it would make savings of 27 billion euros (US$36 billion) for the rest of this year from the central government budget, equivalent to about 2.5 percent of GDP. The figure includes tax rises and spending cuts of about 15 billion euros announced in December.
The cuts come despite popular resistance — a general strike on Thursday disrupted transport, halted industry and saw some minor violence — and against a grim economic backdrop; Spain is thought to have fallen back into recession in the first quarter and has the highest unemployment rate in the EU.
“Everyone knows the difficult problem we face in this country, and it calls for special efforts in fiscal consolidation and structural reforms to grow and create employment,” Spanish Deputy Prime Minister Soraya Saenz de Santamaria said after the weekly Cabinet meeting.
The center-right government, which swept to power in November with the largest parliamentary majority in 30 years, has already passed labor market and banking sector reforms that it says can improve competitiveness and -reduce wage costs.
EU partners have agreed to let Spanish Prime Minister Mariano Rajoy aim for a total deficit this year at 5.3 percent of GDP, a less demanding goal than the 4.4 percent originally suggested, but substantially less than last year’s 8.5 percent.
Speaking in Copenhagen after an EU ministerial meeting, Spanish Economy Minister Luis de Guindos said the measures would be implemented as soon as possible, adding that any suggestions that Madrid needed emergency international funds was “absurd.”
Spain is trying to assure its EU partners that it is in control of slashing its deficit and to avoid needing a bailout package like that of smaller neighbor Portugal.
“What comforts markets are domestic policies. If we don’t do what is needed, then there will be no rescue fund that is big enough,” De Guindos said.
Finance ministers agreed on Friday to increase a financial firewall to 700 billion euros to ward off fears the eurozone debt crisis could spill over to Spain or Italy, much larger economies than those bailed out previously.
The Spanish government said it was aiming for a central government deficit equivalent of 3.5 percent of GDP, a deficit of 1.5 percent of GDP coming from Spain’s regions and a balanced social security budget. Smaller local authorities expect a deficit equivalent to 0.3 percent of GDP.
The regions announced a deficit of 2.9 percent of GDP last year, meaning they would have to cut about 15 billion euros to meet this year’s target.
Details were scarce, with the government due to set the budget before parliament on Tuesday.
The government said it would slash spending by 16.9 percent across the ministries, with spending at the foreign ministry cut by more than half, and the Industry, Energy and Tourism Ministry taking a cut of more than 30 percent.
Total cuts of more than 42 billion euros, between the central administrations and the regional authorities, could be tough for an economy struggling to grow, economists say.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained