EU Reportedly Talking to Spain about Bailout (CNBC)

Spain’s economy much bigger than those of other European nations that have been bailed out.

With the Financial Times reporting that the European Union is in discussion with Spain about a bailout, CNBC discusses the ways in which Spain differs from the nations the EU has helped out to date, Ireland, Portugal and Greece.

For starters, Spain is much bigger, with a GDP larger than the combined GDPs of Ireland, Portugal and Greece. And its problem isn’t an overhang of sovereign debt – in fact, its ratio of debt to GDP is lower than Germany’s – but its troubled banking sector.

CNBC cites analysts suggesting the EU is giving Spain time to announce government cutbacks before a bailout is announced, so it doesn’t seem as though the EU is telling it what to do. And it cites a Reuters story that says Spain’s government is looking at freezing pensions and raising the retirement age.

 

See the full story here.

 

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