An enormous task

SPAIN awoke to a new era yesterday with Mariano Rajoy of the Partido Popular delivering a crushing victory which gives his centre-right government a clear mandate to lead Spain. The task ahead is enormous and there are few bright spots apart from his majority. The Spanish economy is in a terrible mess; record high unemployment and the financial markets fear that there is a possibility that Spain could follow Greece, Italy, Portugal and Ireland and require help from the European Union. Rajoy has promised enormous cuts as he attempts to bring Spain's big budget deficit under control. But already the trade unions are threatening to fight his cuts and Spain faces a winter of discontent. Bringing Spain back from the brink is going to take great political courage and some luck. Rajoy has promised to reduce Spain's enormous rate of unemployment but government coffers are empty and the private sector is feeling the full force of the recession. Even the European Union is concerned about the Spanish economy despite publicly saying that former Prime Minister Rodriguez Zapatero had taken the right economic action. The Spanish economy is too big to fail; it is the fourth biggest in the euro-zone. Last week the Spanish government had to pay an enormous rate of interest for its government loans. The warning signals are there. Rajoy must try and calm the financial markets and put Spain on the right track. A big task? I would say enormous.