Spain Business
Spain Business Brief - Monday May 19 2008
By h.b.
May 19, 2008 - 12:34 PM

El Mundo reports today that the increase in the numbers of unemployed means that the funds for the dole payments for this year will be empty in September.
The Government has budgeted 15.5 billion € for 2008, only 1.5% more than what was spent last year, but up to just March had spent 4.5 million of that, some 20% more than a year ago.
The paper reports that month on month it is ever clearer that it is the immigrant worker who is losing his or her job first in the current economic slowdown.

The new Spanish Minister for Employment and Immigration, Celestino Corbacho, has put the crash plan to help the unemployed in Spain on hold. The plan had been set up by his predecessor, Jesús Caldera. The new minister says that he wants to reflect on the plans to relocate workers as a way of fighting unemployment.
Observers think the plan from Caldera was somewhat improvised following accusations of a lack of action from the Government on the matter.

Meanwhile, with the data of Ireland missing, Spain is the country to show the largest fall in the construction sector according to new EU data released this morning. Brussels considers that the fall here has been greater than 10% when comparing activity this March to March 2007.

The Spanish Minister for Agriculture, Elena Espinosa, is to ask Europe to try and keep basic foodstuff prices at a reasonable price for the public. EU Agriculture ministers are meeting today to analyse what has been happening with the recent large increases in food prices, and how to combat cases of speculation which have been occurring.

Air Nostrum has cancelled 760 flights planned for May because of a strike by pilots. The stoppages will be on the 21,22,23,28,29 and 30 of the month and it has been calculated will affect 32,000 travellers.
Most of the flights affected are from Madrid, followed by Barcelona and Valencia, Santander, Bilbao and Seville.
Flights from the mainland to the Canaries, Balearics and Melilla are not affected.
The company has said they will try and reach an agreement with the pilots until the very last moment ahead of the stoppage, which they consider to be ‘abusive, disproportionate and irresponsible’.
Those who want more information are invited to call Serviberia on 902 400 500. People who find their flight has been cancelled will be able to change the date of their trip or obtain a full refund.

The Economist magazine has named the Bank of Spain as an example to follow in the regulation of the banking industry. In an article called ‘Paradise lost’ the magazine concludes that very few regulators have emerged from the current financial crisis with a good image, criticising the United States, German and British regulators in particular. In Madrid, however the magazine says there is a sensation of satisfaction despite the ever more evident slowdown.

The Deputy Prime Minister, María Teresa Fernández de la Vega, has said the Government will take consumers and businesses into account when it finally approves the forthcoming price increase for electricity. First reports of a 20% hike have been replaced by an 11% rise which still has to be approved in cabinet.

Despite offers making car prices fall by 0.7% during April, sales continued to fall, according to the latest numbers from the INE, National Statistics Institute. Car sales for the first half of May are 19.5% down on last year according to the Faconauto dealers’ federations.