Spain economy slows in second quarter

26th August 2011, Comments 0 comments

Spain's economy slowed in the second quarter of 2011 as the country battled fears of a sovereign debt crisis, official figures showed Friday.

The economy expanded 0.2 percent in the second quarter compared to the previous three months when it grew an upwardly revised 0.4 percent, the National Statistics Institute said.

The Spanish economy slumped into recession during the second half of 2008 as the global financial meltdown compounded the collapse of a property bubble. It stabilised in 2010.

Spain's towering unemployment rate -- 20.89 percent in the second quarter of 2011 -- has helped to whip up a nationwide "indignant" protest movement against the pain caused by the economic slump.

Spain has been tightening state spending to try to stave off concern in financial markets which fret about its ability to repay its debt because of high borrowing levels and slow economic growth.

The latest figures showed Spain's economy grew 0.7 percent in the second quarter of 2011 when compared to the same period a year earlier, after posting annual growth of 0.9 percent in the first three months of the year.

The annual figures showed consumers kept a tight grip on their wallets, with household spending shrinking 0.2 percent from a year earlier, while the economy got a boost from tourism which pushed up spending by non-residents by 9.0 percent.

© 2011 AFP

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