Spain Business Brief - Thursday June 11 2009

Spain Business Brief - Thursday June 11 2009
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By h.b. - Jun 11, 2009 - 9:29 PM
Elena Salgado gives interview to the Financial Times

Elena Salgado - EFE

The Spanish Minister for Finance, Elena Salgado, has said, in an interview with the Financial Times, that there will be fewer financial entities in Spain in the future, but they will be more solid. She tells the paper that now is a good time for a restructuring of the system, ahead of any more possible problems.
It comes after the Government has announced the creation of a 9 billion € fund which will be used to help savings banks and is planned to be launched this month. The fund could be used to guarantee ten times as much money according to sources, allowing the Bank of Spain to take control of any banks or savings banks which run into difficulty.

Meanwhile the BBVA bank has announced the closure of 170 of its offices in Spain and the transfer of 500 employees. The bank says it is reacting to lower levels of activity and the closures represent 5% of their branches.

The European Central Bank is forecasting that the deterioration in the labour market will intensify, and that recovery will start in the middle of next year after a time of stabilisation. It comes after the bank left EU interest rates at 1% last week.
Meanwhile an EU report has said that Spain is responsible for 40% of the unemployment created in Europe since last October. The study says the unemployment rate here is double the European average, and has placed the number out of work at 4.2 million.

The entrepreneur known by the popular name as ‘El Pocero’ has said that he is not going to complete the building planned at the Madrid dormitory town of Seseña.
A service road is still to be completed and more high tension power lines and better water infrastructure are reported as needed, but Francisco Hernando, has said he is to move his interests elsewhere, with projects in Guinea. How he obtained the licence to build the massive complex remains the subject of a legal investigation with the Ex Socialist Mayor, José Luis Martín, alleged to have accepted backhanders in exchange.
Only 5,000 of the planned 13,000 homes at the site have been completed.

Air Nostrum has announced an ERE employment regulation which will affect 507 workers who will be laid off on a temporary basis. The regional airline also plans to drop non profitable routes, again on a temporary basis.
The company has a total workforce of 2,250.

Inoxcrom, the biro company has announced it is going to sack 105 of its 250 workers. The company changed hands in February to avoid bankruptcy then, and the new owners say the job losses are now needed to save the Barcelona factory.

And finally,
Beer consumption in the bars of Spain has fallen by 10%, while sales in supermarkets are up 2.4% according to the data for the first quarter of the year compared to last.
It shows how consumers are changing their habits in the face of the recession and spending less, and also shows how sales are affected by the lower tourist numbers.

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