Finance ministers from the 17 countries that use the euro were to discuss a potential rescue for Spain yesterday, a eurozone official said, as pressure grows on Madrid to sort out its troubled banks even if it means seeking a European bailout.
The latest report — from the IMF — estimated that Spain needs at least a 40 billion euro (US$50 billion) capital injection following a stress test it performed on the country’s financial sector. That report came out early yesterday, three days ahead of schedule, underscoring the urgency of the situation.
Spanish Deputy Prime Minister Soraya Saenz de Santamaria said on Friday that the government would wait for the results of three reports, including the IMF one and two from independent auditors, before acting. However, pressure is rising on the country, and the government appears to have resigned itself to the fact that it needs a bailout with money pumped in from Europe to prop up its struggling banks, and cannot handle the job on its own.
A spokesman for Luxembourg Prime Minister Jean-Claude Juncker, who chairs the meetings of eurozone finance ministers, said that the ministers would discuss the situation in a conference call yesterday afternoon.
Guy Schuller said that Spain had not yet asked for help, “but we want to prepare if the call comes.”
Officials at the Spanish Ministry of the Economy did not immediately respond to requests for comment.
If it does request a bailout, Spain would become the fourth eurozone country to do so since the continent’s debt crisis touched off two years ago. The three countries that have received rescues thus far — Greece, Ireland and Portugal — are fairly small, and many have worried that bailing out much-larger Spain could call the entire euro project into question. Officials must walk a fine line between giving Spain enough money to make a rescue credible, if one is asked for, and not bankrupting the system.
On Friday, Saenz de Santamaria declined to say how much the sector, hit by the collapse of the country’s real-estate bubble, might need. Estimates of the cost of bailing out Spain’s banks vary greatly, from 40 billion euros to as much as 100 billion euros.
Spain has been accused of being too slow to set out a roadmap to resolve its problem. European business leaders and analysts have stressed that Spain must find a solution quickly so that it is not caught up in any market turmoil sparked by the Greek elections on Sunday next week.
“What we now crucially need is transparency and trust,” said Andreas Schmitz, the head of Germany’s banking association. “Any further uncertainty, any speculation how the situation could develop is poisonous for the markets.”
However, others said it was more important for Spain to correctly assess how to shore up its banking system than it was to hurry into a bailout. The audits that Spain’s government is waiting for are crucial to determining precisely how much capital the nation’s troubled banks need, Capital Economics analyst Mark Miller said. The reports from independent auditors are due by June 21.
US PUBLICATION: The results indicated a change in attitude after a 2023 survey showed 55 percent supported full-scale war to achieve unification, the report said More than half of Chinese were against the use of force to unify with Taiwan under any circumstances, a survey conducted by the Atlanta, Georgia-based Carter Center and Emory University found. The survey results, which were released on Wednesday in a report titled “Sovereignty, Security, & US-China Relations: Chinese Public Opinion,” showed that 55.1 percent of respondents agreed or somewhat agreed that “the Taiwan problem should not be resolved using force under any circumstances,” while 24.5 percent “strongly” or “somewhat” disagreed with the statement. The results indicated a change in attitude after a survey published in “Assessing Public Support for (Non)Peaceful Unification
The CIA has a message for Chinese government officials worried about their place in Chinese President Xi Jinping’s (習近平) government: Come work with us. The agency released two Mandarin-language videos on social media on Thursday inviting disgruntled officials to contact the CIA. The recruitment videos posted on YouTube and X racked up more than 5 million views combined in their first day. The outreach comes as CIA Director John Ratcliffe has vowed to boost the agency’s use of intelligence from human sources and its focus on China, which has recently targeted US officials with its own espionage operations. The videos are “aimed at
‘MISGUIDED EDICT’: Two US representatives warned that Somalia’s passport move could result in severe retaliatory consequences and urged it to reverse its decision Minister of Foreign Affairs Lin Chia-lung (林佳龍) has ordered that a special project be launched to counter China’s “legal warfare” distorting UN Resolution 2758, a foreign affairs official said yesterday. Somalia’s Civil Aviation Authority on Wednesday cited UN Resolution 2758 and Mogadishu’s compliance with the “one China” principle as it banned people from entering or transiting in the African nation using Taiwanese passports or other Taiwanese travel documents. The International Air Transport Association’s system shows that Taiwanese passport holders cannot enter Somalia or transit there. The Ministry of Foreign Affairs (MOFA) protested the move and warned Taiwanese against traveling to Somalia or Somaliland
SECURITY: Grassroots civil servants would only need to disclose their travel, while those who have access to classified information would be subject to stricter regulations The government is considering requiring legislators and elected officials to obtain prior approval before traveling to China to prevent Chinese infiltration, an official familiar with national security said yesterday. President William Lai (賴清德) in March announced 17 measures to counter China’s growing infiltration efforts, including requiring all civil servants to make trips to China more transparent so they can be held publicly accountable. The official said that the government is considering amending the Act Governing Relations Between the People of the Taiwan Area and Mainland Area (臺灣地區與大陸地區人民關係條例) to require all civil servants to follow strict regulations before traveling to China.
RSS