Belfast Telegraph

Home News World

Spain facing general strike threat

Spain is facing a general strike as unions challenge a conservative government not yet 100 days old.

The stoppage, called to protest against changes to labour market rules long regarded as among Europe's most rigid, comes a day before the government will serve up even more austerity pain.

A budget expected on Friday is set to feature tens of billions of euros in deficit-reduction measures. The cuts are designed to help Spain in its struggles to satisfy the European Union and the international investors who determine the country's borrowing costs in the international debt markets - and therefore have a lot of say in whether Spain will follow Greece, Ireland and Portugal in needing a bailout.

On top of a round of spending cuts and tax hikes, and reform of the bank sector, last month prime minister Mariano Rajoy's newly elected government passed a decree on worker's rights. The legislation makes it cheaper and easier for companies to lay people off, cut wages and modify other working conditions just by citing concerns over, for example, productivity.

The idea behind the decree is to make Spain more competitive once the rest of Europe recovers and employers are less wary of hiring. The jobless rate is nearly 23%, a eurozone high, and nearly 50% among young people.

The country's two main unions are hoping for an enthusiastic turnout, and more than during a general strike in 2010 when a Socialist government enacted its own, less aggressive labour market reforms.

"The people will say whether they are resigned to accepting the reforms," said Ignacio Fernandez Toxo, head of one of Spain's main unions, known as CCOO.

The government says it will not falter in its austerity drive, calling the reforms essential to creating jobs and reviving an economy that is expected to contract 1.7% this year. "The question here is not whether the strike is honoured by many or few, but rather whether we get out of the crisis," finance minister Cristobal Montoro said. "That is what is at stake, and the government is not going to yield."

The government, which came to power in December after the Popular Party scored a landslide win over the Socialists, has a mandate to save the country from financial ruin, Mr Pin said. That means it is unlikely to worry much about its popularity rating.

"There are two elements - Spanish voters and international investors - and right now the government is governing for the investors," he said.

Popular

From Belfast Telegraph