Spain to revive suspended infrastructure projects: report

11th August 2010, Comments 0 comments

Spain's government said Wednesday it will relaunch some infrastructure projects that were suspended as part of austerity measures but it will not put at risk its plans to slash the public deficit.

"The stability of the financial markets allows us to have a small margin" in the budget to maintain some projects because "the cost of our debt is lower," Finance Minister Elena Salgado told the Europa Press news agency.

This margin will allow Transport and Development Minister Jose Blanco to "maintain some projects" but the cost of these will not be "particularly significant," Salgado said.

Blanco on July 22 announced a reduction in his ministry's budget of 6.4 billion euros (8.3 billion euros) for 2010 and 2011, leading to the suspension of 199 road and rail projects for one to four years.

Unions protested, claiming that the cuts would lead to the loss of 100,000 jobs at a time when unemployment has soared to more than 20 percent.

The government this year introduced tough austerity measures to rein in the public deficit from a massive 11.2 percent of gross domestic product in 2009 to six percent in 2011 and three percent -- the EU limit -- by 2013.

Salgado said the deficit reduction plan remains our "number one priority."

Socialist Prime Minister Jose Luis Rodriguez Zapatero said Tuesday he planned to announce an easing of public works cutbacks in "10 to 15 days" in order to maintain some infrastructure projects.

© 2010 AFP

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