Spain's new leader to present deep austerity action
Spain's incoming prime minister Mariano Rajoy presents radical spending cuts on Monday to rescue the economy from crisis, in a speech to parliament ahead of his investiture.
With five million people unemployed and warnings of a fresh recession looming, Rajoy has promised deep cuts in spending but kept quiet about the details since his landslide election win a month ago.
Now poised to take the reins, he is expected to detail the cuts which he has warned will hit "everywhere" except on pensions in order to lower the budget deficit and reassure the financial markets where Spain borrows to fund its debt.
"His speech to parliament will not be a mere formality and will not hide the severity of the measures his government will take before the end of the year," the conservative daily ABC said in an editorial.
While Rajoy has spent the past month in meetings planning the start of his term, the stakes have risen: ratings agencies this month named Spain among several eurozone countries facing a possible credit downgrade.
Markets have been anxious for months that crises in Greece and Italy, where concerns over high public debts have likewise toppled governments and pushed up borrowing costs, will spread to Spain and across the eurozone.
Rajoy has vowed to stick to Spain's targets to cut the deficit to 4.4 percent of gross domestic product in 2012 and 3.0 percent of GDP -- the EU limit -- in 2013.
The shortfall amounted to 9.3 percent of GDP last year and is targetted at 6.0 percent of GDP this year.
His speech to the lower house of parliament at 1100 GMT on Monday is followed by a two-day debate and then a vote by parliament -- in which his Popular Party holds an absolute majority -- to swear him in as prime minister.
Commentators stressed the urgency for Rajoy to make a strong statement of intent on Monday, although the fine details of the cuts were not expected to be unveiled until after his government takes office on Thursday.
"He must explain sincerely his political program, his medium-term aims and his plans for for getting the country out of the wreck it is in," wrote another conservative newspaper, El Mundo, in an editorial.
Rajoy, 56, won power on November 20 on his third attempt, as voters suffering economic hardship and a 21.5-percent unemployment rate turfed out the governing Socialists.
Spending cuts started by outgoing premier Jose Luis Rodriguez Zapatero have already begun biting into healthcare and education services in some regions, prompting street protests.
"Things are complicated. It is going to be necessary to govern and take decisions," Rajoy said this month. "What lies ahead for Spain is difficult... but we will come out on top."
© 2011 AFP