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New Spanish leader names cabinet

Spain's new conservative prime minister has appointed his cabinet, including ministers charged with lifting the country out of its severe economic crisis.

Mariano Rajoy was sworn in as premier before King Juan Carlos. He then appointed 12 ministers and said close party colleague Soraya Saenz de Santamaria would be government spokeswoman and deputy premier.

His Popular Party won a landslide victory in November 20 elections on promises to lift Spain out of economic turmoil.

Spain has a eurozone-high unemployment rate of 21.5%, a swollen deficit and stalled economy after a near two-year recession triggered by the collapse of a property bubble in 2009.

Rajoy and the Popular Party replaced the Socialists, who under Jose Luis Rodriguez Zapatero had been in office since 2004 but were punished heavily in the elections for their handling of the crisis.

Spain has already made sharp cuts to its national spending and introduced several reforms under Zapatero in a bid to convince investors and the European Union but the measures have so far failed to boost the economy much.

The country's borrowing costs spiralled amid fears it might need a bailout like Greece, Ireland and Portugal but in recent weeks they have begun to slip back.

On Monday, Rajoy pledged more austerity cuts totalling 16.5 billion euro (£13.7 billion).

The conservative leader promised reforms to encourage companies to hire and tax breaks for small and medium-sized firms that make up the bulk of the economy. He also intends to trim government personnel with a hiring freeze for most civil servant groups.

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