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Spain Business Brief - Tuesday June 17 2008
By h.b. - Jun 17, 2008 - 1:01 PM
ALSO SEE : • Spain Business Brief - Monday October 13 2008 - Oct 13, 2008 - 12:49 PM
• Terra Mítica owes the state 15 million Euro - Oct 13, 2008 - 7:31 AM

The Bank of Spain in Cibeles Madrid - Archive Photo EFE
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More gloom on the state of the Spanish economy from the Bank of Spain.

The Bank of Spain has warned that the economic slowdown could put the achievements of recent years in Spain in doubt. The Bank now considers that Spain has grown in an unbalanced way because of the real estate bubble and that the international crisis has only made the correction worse. The Government continues to consider growth of 2% will be seen in the second quarter.

The Spanish Savings Banks Association, FUNCAS, has said that the threat of recession is hanging over the Spanish economy. They say the contraction of the economy is leading the country to recession, and predict that unemployment will be close to 10% at the end of the year, with inflation over 4%. The General Director of FUNCAS, Victorio Valle, warned that a possible recession could be ‘intense and long-lasting’. In any case, he said, that the Spanish economy would not start to recover for a couple of years.

The judiciary in New York has rejected the purchase of Energy East by the Spanish company Iberdrola. It seems the American courts are demanding that a series of conditions be met to guarantee the power supply, despite the fact that Iberdrola has already obtained all the federal and state permissions for the 6.4 billion € take over – with the exception of the state of New York.

Spanish companies paid an average of 1,689 € a month to their employees in salary costs over the first quarter of the year, according to numbers just released by the INE National Statistics Institute. The number is 5.3% higher than that seen last year for the same period.
The construction industry is the area to see the greatest moderation in salary costs, followed by the service sector.
Labour costs are highest in Madrid, and lowest in Extremadura.

The number of foreigners who are paying into the Spanish Social Security system is now 11% of the total, with 45,655 immigrants affiliated to the service in May. The number is up 2.1% over the month. 27% of the foreigners come from elsewhere in the European Union while those from outside Europe saw the greatest growth in numbers according to the data from the Ministry for Employment and Immigration. Four out of every ten foreigners are Moroccan or from Ecuador, and the construction industry sacked 4,699 foreigners over the month of May.

Farmers unions ASAJA and COAG have called on their members to demonstrate on Thursday this week at the high price of fuel. Demonstrations are being planned, possibly with slow-moving tractor drivers in all the main cities across the country, and a demonstration is planned outside the offices of the Minister for Agriculture, Elena Espinosa.

The Ministry for Industry is putting the final details on the proposal to increase electricity prices in Spain, with an increase which will result in prices between 7.3% and 8.3% higher in some 18 million homes. The average official increase, to be imposed on July 1 is 5.6%.
The new increases come on top of a general 3.3% increase in price which was introduced at the start of the year as the Governments wants to get charges close to the real costs of generating power.

And finally,
Hacienda tax authorities have already paid back 4.2 billion € to six million tax payers in Spain. The number of declarations presented over the internet this year is up by 39%.


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ALSO SEE :
• Spain Business Brief - Monday October 13 2008 - Oct 13, 2008 - 12:49 PM
• Terra Mítica owes the state 15 million Euro - Oct 13, 2008 - 7:31 AM
• Spain Business Brief - Friday October 10 2008 - Oct 10, 2008 - 1:36 PM
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• Spain Business Brief - Thursday October 9 2008 - Oct 9, 2008 - 12:59 PM
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• Spain Business Brief - Tuesday October 7 2008 - Oct 7, 2008 - 1:19 PM
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