Spanish economy crawls out of recession

| May 7, 2010
Spanish economy crawls out of recession

The Spanish economy has finally emerged from recession after experiencing growth of just 0.1% in the first quarter of 2010, ending a run of seven consecutive quarters of contraction.

A report from the country’s central bank said: “The information available indicates a return to weak growth in the first quarter in an environment characterised by a progressive recovery in the global economy.”

However, there will undoubtedly be fears over the recovery since the latest figures show unemployment tipped over the 20% mark – one of the highest rates of unemployment within the 16-member euro zone.

Spain’s jobless rate is double the 10% for the euro zone as a whole with the total number of jobless in the country at 4.61 million.

The economy has been hit by a severe slump within its key construction industry, which has led to a significant amount of job losses.

Last week, Standard & Poor’s (S&P) downgraded Spain’s credit rating by one notch to AA from AA+ over fears for the country’s economic outlook.

The Spanish economy, which is the euro zone’s fourth largest, contracted by 3.6% in 2009.

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