Spains debt level and borrowing needs are set to rise next year,piling pressure on the government to apply for international aid,as it pours funds in to cash-strapped regions and an ailing banking system,its budget showed on Saturday.
Spains debt as a ratio of gross domestic product will reach 90.5 per cent by end 2013,according to the document presented to Parliament for approval,almost three times that registered before the property bubble burst in 2008.
The budget aims to make savings of around 13 billion euros ($16.72 billion) next year by cutting spending by the public ministries,education,health and infrastructure investments and freezing public workers wages.
This is an austerity budget,but will serve to help us get over this long economic crisis and once again show that Spain is a trustworthy partner within Europe, Treasury Minister Cristobal Montoro said.
Spain is at the centre of the euro zone debt crisis as nervous investors demand ever higher premiums to hold Spanish debt on concerns the government cannot control its finances in the midst of a deepening recession.