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

IS Militants Release 49 Turkish Hostages

Turkey's state-run Anadolu news agency reports that no ransom was paid and no conditions accepted for the hostages' release; few details of the release are known More

Photogallery IS Attacks Send Thousands of Syrian Kurds Fleeing to Turkey

Syrian Observatory for Human Rights says more than 300 Kurdish fighters crossed into Syria from Turkey to defend a Kurdish area from attack by the Islamic militants More

Video Sierra Leone's Ebola Lockdown Continues

Thousands of health workers are going door to door in the West African country of 6 million, informing people of how to avoid Ebola, handing out soap More

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.
Fears Ebola Outbreak ‘Beyond Our Capability to Contain’i
X
Jeff Seldin
September 20, 2014 10:28 PM
Each day brings with it new warnings about the deadly Ebola outbreak already blamed for killing more than 2,600 people across West Africa. And while countries and international organizations like the United Nations are starting to come through on promises of help for those most affected, the unprecedented speed with which the virus has spread is raising questions about the international response. VOA's Jeff Seldin has more from Washington.
Video

Video Fears Ebola Outbreak ‘Beyond Our Capability to Contain’

Each day brings with it new warnings about the deadly Ebola outbreak already blamed for killing more than 2,600 people across West Africa. And while countries and international organizations like the United Nations are starting to come through on promises of help for those most affected, the unprecedented speed with which the virus has spread is raising questions about the international response. VOA's Jeff Seldin has more from Washington.
Video

Video Iran, World Powers Seek Progress in Nuclear Talks

Iran and the five permanent members of the U.N. Security Council plus Germany, known as the P5 + 1, have started a new round of talks on Iran's nuclear program. VOA State Department correspondent Pam Dockins reports that as the negotiations take place in New York, a U.S. envoy is questioning Iran's commitment to peaceful nuclear activity.
Video

Video Obama Goes to UN With Islamic State, Ebola on Agenda

President Obama goes to the United Nations General Assembly to rally nations to support a coalition against Islamic State militants in Iraq and Syria. He also will look for nations to back his plan to fight the Ebola virus in West Africa. As VOA White House correspondent Luis Ramirez reports, Obama’s efforts reflect new moves by the U.S. administration to take a leading role in addressing world crises.
Video

Video Migrants Caught in No-Man's Land Called Calais

The deaths of hundreds of migrants in the Mediterranean this week has only recast the spotlight on the perils of reaching Europe. And for those forunate enough to reach a place like Calais, France, only find that their problems aren't over. Lisa Bryant has the story.
Video

Video Westgate Siege Anniversary Brings Back Painful Memories

One year after it happened, the survivors of the terror attack on Nairobi's Westgate Shopping Mall still cannot shake the images of that tragic incident. For VOA, Mohammed Yusuf tells the story of victims still waiting for the answer to the question 'how could this happen?'
Video

Video Militant Assault in Syria Displaces Thousands of Kurds

A major assault by Islamic State militants on Kurds in Syria has sent a wave of new refugees to the Turkish border, where they were stopped by Turkish border security. Turkey is already hosting about 700,000 Syrian refugees who fled the civil war between the government and the opposition. But the government in Ankara has a history of strained relations with Turkey's Kurdish minority. Zlatica Hoke reports Turkey is asking for international help.
Video

Video Whaling Summit Votes to Uphold Ban on Japan Whale Hunt

The International Whaling Commission, meeting in Slovenia, has voted to uphold a court ruling banning Japan from hunting whales in the Antarctic Ocean. Conservationists hailed the ruling as a victory, but Tokyo says it will submit revised plans for a whale hunt in 2015. Henry Ridgwell reports from London.
Video

Video A Dinosaur Fit for Land and Water

Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video Iraqi Kurdistan Church Helps Christian Children Cope find shelter in churches in the Kurdish capital, Irbil

In the past six weeks, tens of thousands of Iraqi Christians have been forced to flee their homes by Islamic State militants and find shelter in churches in the Kurdish capital, Irbil. Despite U.S. airstrikes in the region, the prospect of people returning home is still very low and concerns are starting to grow over the impact this is having on the displaced youth. Sebastian Meyer reports from Irbil on how one church is coping.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid