World Economic outlook - Spain Labor Market forecast 2012 : Spain has a lower public debt-to-GDP ratio than not only Italy, but also France, Germany, and the UK. So why is it threatened with another downgrade? This column points to the fundamental problem with Spain’s economy – the insider-outsider divide that has led to the highest unemployment rate in the Eurozone. It proposes a single open-ended contract for all workers – a difficult solution whose time has come.
Despite having a public debt-to-GDP ratio that is lower not only than Italy’s but also than that of France, Germany, and the UK, and despite having a new government committed to fiscal consolidation, Spain is still in trouble. It faces difficulties obtaining credit in international financial markets. Aside from the unresolved restructuring of its banking sector, this situation has arisen mainly as a result of a lack of competitiveness and low expected economic growth. read more..
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