Spaanse premier presenteert nieuwe economische maatregelen (en)
Spain's Socialist prime minister, Jose Luiz Rodriguez Zapatero i, announced new spending measures in a state-of-the-nation address on Tuesday (12 May), aimed at boosting the country's ailing economy and keeping people in their jobs.
During the address, he also announced new measures to cut public spending and increase tax revenues as Spain, like many others EU member states, struggles to contain its burgeoning budget deficit.
"These measures have a double objective: stop job losses and prepare for economic recovery with changes in our economic model," Mr Zapatero said during his speech to the Spanish parliament.
Opposition parties, hoping to make gains over the government in next month's European elections, dismissed the plans as wishful thinking.
New job saving measures include a proposal to lower the corporate tax rate by five per cent over the next three years for small businesses who maintain or increase the number of employees held on their books.
A new €2000 incentive scheme aims to boost the country's ailing automobile sector. The government says it will contribute €500 towards the purchase of a new car, calling on regional governments to match this figure and for industry to provide the remaining €1000.
Spain's vital tourism sector is to receive €600 million for modernisation projects as many penny-pinching British and Germany tourists look set to cancel this year's beach holiday in the sunny southern European country.
Until now, the country has been the world's top tourist destination after France, receiving around 60 million visitors per year, with the industry employing one in every seven Spanish workers.
Spain's national statistics office reported last month that the country's unemployment rate reached 17.4 per cent in March, the highest in the EU.
A chief reason for this is the large downturn in the previously booming construction sector that analysts say the government allowed to overheat.
In response to this, a new €20 billion public-private Fund for a Sustainable Economy is to be set up in order the shift dependence away from the construction sector and onto more value-added industries such as the creation of renewable energy.
Likewise, plans to scrap income tax reductions on house purchases for all but the lowest earners will also help to boost state coffers and prevent future inflation of the country's housing sector.
Despite the new stimulus projects, Mr Zapatero said public finances will not come under greater than anticipated strain this year, thanks to €1.5 billion in government spending cuts.