EC's Almunia dismisses Spanish crisis talk

14th January 2008, Comments 0 comments

The slowdown in the Spanish property sector will have a limited impact on the domestic economy, European commissioner for economic affairs Joaquín Almunia said Friday.

14 January 2008

BRUSSELS - The slowdown in the Spanish property sector will have a limited impact on the domestic economy, which will continue to grow above the average in Europe, the European commissioner for economic affairs, Spaniard Joaquín Almunia said Friday.

Almunia told a news conference in Brussels that the impact of a loss of dynamism in the Spanish housing market would shave at most one to two tenths of a point off GDP growth.

"No way should we spread a negative or alarmist picture" of the Spanish economy, Almunia said.

He noted that activity in Spain had outstripped the average in Europe for 12 years.

The commissioner said there would be lower growth in general in Europe and the United States this year as a result of the liquidity crisis sparked by the US subprime mortgage crisis.

The European Commission is predicting the Spanish economy will grow 3.0 percent this year, the European Union 2.4 percent and the euro area 2.2 percent.

The Spanish government recently trimmed its forecast for GDP growth for this year to 3.1 percent from 3.3 percent. The economy is estimated to have grown 3.8 percent last year.

"Lots of countries that do not have a slowing property sector would want growth of 3 percent," Almunia said.

[Copyright EL PAÍS / Adrián Soto /Andreu Missé 2008]

Subject: Spanish news

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