Spain: debt deal will 'stop contagion'

22nd July 2011, Comments 0 comments

The Spanish government welcomed the deal reached in Brussels to bail out Greece, saying that it would "halt all possibility of contagion" in the eurozone.

"The eurozone countries have agreed on a deal to respond effectively to the situation in Greence as well as establish a barrier to halt all possibility of contagion or instability in the financial markets," chief government spokesman Jose Blanco told a news conference following a cabinet meeting.

"With this deal, Europe has won and we have strengthened the economic and monetary union," he said.

"It is the path that the European Union must follow, continuing to strengthen the mechanism of a common and coordinated policy."

Eurozone leaders agreed late on Thursday to offer Greece a second bailout in a complex deal involving a significant reduction in interest rates for Portugal and Ireland, the other countries receiving European Union and International Monetary Fund bailout loans.

Spain is battling to convince nervous markets that it will not need an international bailout from the European Union and the International Monetary Fund as has been the case for Greece, Ireland and Portugal.

© 2011 AFP

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