News / Europe

Spain PM Resists Calls for His Resignation

Spain's Prime Minister Mariano Rajoy (L) reacts to a question from a reporter as he leaves after a session at the Senate in Madrid, Aug. 1, 2013.
Spain's Prime Minister Mariano Rajoy (L) reacts to a question from a reporter as he leaves after a session at the Senate in Madrid, Aug. 1, 2013.
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Selah Hennessy
— Spain's Prime Minister Mariano Rajoy admitted Thursday that he has made "mistakes" related to a corruption scandal engulfing his party, but he faced down calls for his resignation. Analysts say Rajoy is betting that the economy will save his political career - as Spain, like other euro countries, finally see a slow move toward economic recovery.

A number of top members of Spain’s governing Popular Party are accused of taking under-the-table payments over the course of almost two decades. Rajoy is one of the alleged recipients.

Luis Barcenas, the party’s longtime treasurer until 2009, said a construction magnate gave him cash donations, which he then distributed to senior Popular Party figures.

Rajoy and other members of his party say the claims are false.

But speaking before parliament on Thursday, the prime minister said he had made one mistake.

"I am sorry,” he said, “But that's the way it is. I was wrong in trusting someone we now know didn't deserve it."

Economic defense

But Rajoy said he has no plans to resign, as the main opposition has demanded. Instead, he drew attention to Spain’s economy, which is showing signs of a slow recovery.

Ramon Pacheco Pardo from the European and International Studies department at King’s College London said Rajoy is likely to continue with that line of defense.

“I think that the message that is going to come from the government and from the prime minister is that the important thing is economic growth: economic growth is probably coming back, so the population should focus on their own pockets rather than on a scandal,” said Pardo.

Spain’s unemployment rate recently dropped from around 27 percent to 26 percent, the biggest improvement in five years. But with more than one-quarter of the population still out of work, the numbers may not be too cheering, says Pardo.

And as the country struggles through crippling economic troubles and widespread unemployment, allegations that governing party members have received tax-free payments has hit a raw nerve.

“We have a recovery but in any case it is not very quick, it has been quite a slow recovery. But also, even though there is a recovery, this has not reached the general population, so the feeling among workers and job seekers is that the situation has not improved yet or is not improving,” he said.

Jobs remain scarce

Pardo said on a macro level, the economy of the eurozone appears to be improving, albeit slowly.
 
Manufacturing activity is on the rise and in some countries, including Spain, exports are growing.

A worldwide survey of manufacturers published on Thursday showed industrial activity has risen in the eurozone for the first time in two years.

But Pardo said those macro level improvements have hardly been felt on the micro level.

Christian Schweiger, a Europe expert at Durham University, said that until Europeans have jobs, European governments will find it hard to convince their electorates that things are looking up.

In some eurozone countries, youth unemployment is about 40 percent.

“These young people, they find no jobs at home. And they are struggling to find jobs abroad," said Schweiger. "Because more and more of them are looking towards countries like Germany and the UK, and these countries are reluctant to accept the flood of migrant workers coming into their countries.”

He said governments should expect widespread protests emerging if the job market does not turn around.
 
Rajoy’s Popular Party has a strong majority in parliament, having won a clear victory in the 2011 vote.

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