News / Europe

    Spain Raises $2.6 Billion on Bond Market

    A trader looks at his screens during a bond auction on a trading floor in Madrid, June 7, 2012.
    A trader looks at his screens during a bond auction on a trading floor in Madrid, June 7, 2012.
    Lisa Bryant
    Jitters about Spain's financial crisis eased slightly after Madrid raised roughly $2.62 billion from a bond-market sale, although at high interest rates. But there are more worrying signs for the eurozone, including a rise in French unemployment.

    Spain's successful bond sale shows Madrid can still access credit markets. But the high interest rates underscored investor fears about the country's troubled banking sector.

    However, European leaders may be closing in on a rescue agreement for Spanish banks. An analyst for the Brussels-based Bruegel research organization, Shahin Vallee, believes a deal may be reached within days, although the details may not be announced until the next European Union summit later this month.

    "The fact that everybody is coming to terms with the idea that financial assistance is needed is a positive development. The disagreement between Paris and Berlin are probably on the amount and also on the use of the money," said Vallee.

    Germany tough on conditions

    Germany, Europe's largest economy, will likely want tough bailout terms for Spain that will include close oversight. Vallee says France will be pushing for a broader restructuring of Europe's banking system.

    Spain has not yet asked for EU aid. Spanish officials are determined to avoid the same stringent conditions that lenders imposed in bailing out Greece, Portugal and Ireland. Analysts say Madrid holds a bargaining chip - as the eurozone's fourth-largest economy, its collapse would be disastrous for the 17-member currency union. 

    Pressure is on for European leaders to act swiftly to resolve the Spanish crisis and the larger eurozone debt problems. That message was delivered by the European Central Bank this week, when it left its main interest rate unchanged at 1 percent.

    At a news conference, ECB chief Mario Draghi said monetary policy is not enough to address the eurozone crisis.

    "We have seen that this crisis is the product of many many factors," he said. "Some have their roots in their national government policies.  Others have their roots in the fact that our integration process has reached a point where it has to question itself and decide whether it wants to move further or not."

    French unemployment

    More worrying economic news came from France, Europe's second-largest economy. Newly posted figures show unemployment at 10 percent - a 12-year high. 

    But analyst Vallee believes newly elected President Francois Hollande, who has been promoting growth as a key solution for Europe's woes, has some breathing room.

    "I think France really has a number of domestic policy issues to deal with. But if Hollande contributes positively to solving the European crisis, I think he can buy some time before delivering important structural reforms in France," said Vallee.

    For Spain, the next key test may come Monday, when the International Monetary Fund issues a report and independent audit of its banking sector.

    You May Like

    Taj Mahal Battles New Threat from Insects

    Swarms of insects are proliferating in the heavily contaminated waters of the Yamuna River, which flows behind the 17th century monument

    Self-doubt, Cultural Barriers Hinder Cambodian Women in Tech

    Longtime Cambodian tech observer Sok Sikieng says that although more women have joined profession in recent years, there remain significant factors hindering women from reaching tech potential

    Trans-Adriatic Pipeline to Boost European Energy Security

    $4.5 billion-pipeline will become operational in 2020 and will deliver gas from Azerbaijan’s Shah Deniz II field to southern Italy

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Vietnamese-American Youth Optimistic About Obama's Visit to Vietnami
    X
    Elizabeth Lee
    May 22, 2016 6:04 AM
    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video Vietnamese-American Youth Optimistic About Obama's Visit to Vietnam

    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video First-generation, Afghan-American Student Sets Sights on Basketball Glory

    Their parents are immigrants to the United States. They are kids who live between two worlds -- their parents' homeland and the U.S. For many of them, they feel most "American" at school. It can be tricky balancing both worlds. In this report, produced by Beth Mendelson, Arash Arabasadi tells us about one Afghan-American student who seems to be coping -- one shot at a time.
    Video

    Video Newest US Citizens, Writing the Next Great Chapter

    While universities across the United States honor their newest graduates this Friday, many immigrants in downtown Manhattan are celebrating, too. One hundred of them, representing 31 countries across four continents, graduated as U.S. citizens, joining the ranks of 680,000 others every year in New York and cities around the country.
    Video

    Video Vietnam Sees Strong Economic Growth Despite Incomplete Reforms

    Vietnam has transformed its communist economy to become one of the world's fastest-growing nations. While the reforms are incomplete, multinational corporations see a profitable future in Vietnam and have made major investments -- as VOA's Jim Randle reports.
    Video

    Video Qatar Denies World Cup Corruption

    The head of Qatar’s organizing committee for the 2022 World Cup insists his country's bid to host the soccer tournament was completely clean, despite the corruption scandals that have rocked the sport’s governing body, FIFA. Hassan Al-Thawadi also said new laws would offer protection to migrants working on World Cup construction projects. VOA's Henry Ridgwell reports.
    Video

    Video Infrastructure Funding Puts Cambodia on Front Line of International Politics

    When leaders of the world’s seven most developed economies meet in Japan next week, demands for infrastructure investment world wide will be high on the agenda. Japanese Prime Minister Shinzo Abe’s push for “quality infrastructure investment” throughout Asia has been widely viewed as a counter to the rise of Chinese investment flooding into region.
    Video

    Video Democrats Fear Party Unity a Casualty in Clinton-Sanders Battle

    Democratic presidential front-runner Hillary Clinton claimed a narrow victory in Tuesday's Kentucky primary even as rival Bernie Sanders won in Oregon. Tensions between the two campaigns are rising, prompting fears that the party will have a difficult time unifying to face the presumptive Republican nominee, Donald Trump. VOA national correspondent Jim Malone has more from Washington.
    Video

    Video Portrait of a Transgender Marriage: Husband and Wife Navigate New Roles

    As controversy continues in North Carolina over the use of public bathrooms by transgender individuals, personal struggles with gender identity that were once secret are now coming to light. VOA’s Tina Trinh explored the ramifications for one couple as part of trans.formation, a series of stories on transgender issues.
    Video

    Video Amerikan Hero Flips Stereotype of Middle Eastern Character

    An Iranian American comedian is hoping to connect with American audiences through a film that inverts some of Hollywood's stereotypes about Middle Eastern characters. Sama Dizayee reports.
    Video

    Video Budding Young Inventors Tackle City's Problems with 3-D Printing

    Every city has problems, and local officials and politicians are often frustrated by their inability to solve them. But surprising solutions can come from unexpected places. Students in Baltimore. Maryland, took up the challenge to solve problems they identified in their city, and came up with projects and products to make a difference. VOA's June Soh has more on a digital fabrication competition primarily focused on 3-D design and printing. Carol Pearson narrates.

    Special Report

    Adrift The Invisible African Diaspora