Spain Business
Spain Business Brief - Friday November 14 2008
By h.b. - Nov 14, 2008 - 12:44 PM
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The Eurozone has entered into recession for the first time in its history with the GDP falling for the second consecutive quarter. Germany and Italy have seen two consecutive quarterly falls, while Spain has seen the first fall in GDP for 15 years, down 0.2%.
Falls in consumer spending here and a lack of investment are the main reasons for the 0.2% contraction, according to the numbers from the National Statistics Institute which coincide with the estimates made in the last bulletin from the Bank of Spain at the end of last month.
The fall in interest rates will be passed on to those taking out a new mortgage or who renew their mortgage after Chirstmas. The monthly average of the Euribor for November has fallen to 4.5% and is expected to fall further.
The Government is to offer 29 billion € in loans to Pyme small businesses in Spain next year. The money will come via the ICO, Official Credit Institute, and was announced in Madrid yesterday by the Minister for the Economy, Pedro Solbes. It’s expected that 150,000 small companies will benefit from the measure. He also said that a year moratorium would be granted to those having trouble repaying loans from the ICO-PYME.
Telefónica has announced a 28% fall in profits at 5.596 billion for the year to September. The result is in line with analysts predictions, but when the sales of extraordinary items are removed profits were up 23.5%.
Despite the crisis the companies listed on the IBEX 35 index in Madrid have seen a 10% increase in profits.
14 flights between Spain and France are affected today by a strike in Air France which has seen 40% of services being cancelled.
The Prisa company is reported to be closing their network of local television stations, Localia, which has a debt of 5 billion €. Between 250 and 300 people will lose their jobs as the company concentrates on new digital terrestrial licences.
It comes after rival publishing group Zeta announced plans to lose 25% of its workforce. 533 of the 2,400 jobs in the company will go, 73 of them at the paper ‘El Periódico de Catalunya’. ZTA also owns several other titles, including the magazine ‘Intervíu’ and ‘Tiempo’ among others. The company has 140 million € debt which needs rapid refinancing.
The Chairman of Repsol YPF, Antonio Brufau, has said that the oil company will continue to be Spanish, private and independent. He said the company had to collaborate with all its shareholders but there were a series of premises which had to be respected above all else.
The company has announced a profit for the year to September of 2.816 billion €.