As Portuguese President Aníbal Cavaco Silva once put it, "A country without children is a nation without a future." He was, of course, referring to his country’s ultra-low birth rate, which is just over 1.3 TFR and has been below replacement level (2.1 TFR) since the early 1980s. In 2012 only just over 90,000 children were born in the country, the lowest number in more than a century – you need to go back to the 19th century to find numbers like those we have been seeing since the crisis really took hold. But added to this longstanding, yet unaddressed, problem there is now another just as dangerous one. High unemployment levels and the lack of job opportunities are leading an increasing … [Read more...] about The great Portuguese hollowing out
debt crisis
A slice of Vegas in Spain stirs controversy
It sounds like the answer to the prayers of the Spanish government. A multi-billion-dollar gambling complex led by an American tycoon who promises to bring the glamour of California to Spain and kick-start the country’s struggling economy by creating a quarter of a million jobs. But EuroVegas, as it’s known, is also a scheme that has sparked fears about spiralling crime, prostitution and environmental violations and which has highlighted the age-old tensions between Spain’s two main cities. American casino magnate Sheldon Adelson, with an estimated $25-billion fortune, plans to build a European gambling hub that will include six casinos and 12 hotels. His Las Vegas Sands company says … [Read more...] about A slice of Vegas in Spain stirs controversy
Euro holds firm as crisis drags on
Welcome to my weekly account of changes in the euro exchange rate. This is intended as a brief guide to what’s affected the exchange rate this week, to help you decide when’s the best time for you to change currencies. Exchange rates: GBP to EUR: +1.06% (1.231 to 1.243) USD to EUR: +0.80% (0.791 to 0.797) As you can see here, the euro has held more or less stable in the past week. Yes, the pound has gained more than a cent, but this is within the range established these last six weeks, between 1.23 and 1.25. Of course, this doesn’t mean to say nothing’s happening in Europe. Quite the opposite. Right now, politicians seem to be doing more and saying more than any time I can recall … [Read more...] about Euro holds firm as crisis drags on
Spanish wine bucks recession
In times of recession, it is always surprising to find businesses that have survived – indeed thrived – against the odds. The steady closure of smaller stores has left many Spanish town centres struggling to remain vibrant and in such a climate, niche is everything if you are hoping to capture the market. The main street of the Basque capital Vitoria's old quarter throws up one such case: Martin's Bodega is 15 square metres of wall-to-wall wine. English owner Martin Beacham opened the shop in 2009 just as the recession was beginning to hit. At such a delicate time, it was a straightforward matter of sink or swim. Three years later, business is steadily thriving, though most clients are … [Read more...] about Spanish wine bucks recession
Read my lips: Why did Rajoy break one of his few campaign promises?
“My intention is not to raise taxes.” It’s a line that Mariano Rajoy’s critics will repeat back at him for years to come. Much like George H. W. Bush’s infamous “Read my lips: no new taxes”, Rajoy’s pledge, made on December 19, during the debate ahead of his investiture as Spain’s new prime minister, has proved to be empty. Unlike Bush, Rajoy has not resisted or dragged his feet in performing a spectacular U-turn on this issue. Eleven days after saying he wouldn’t raise taxes, his deputy prime minister, Soraya Sáenz de Santamaría, announced tax increases that will bring in an extra €6 billion this year. As Spaniards digest the implications of the new Popular Party government’s … [Read more...] about Read my lips: Why did Rajoy break one of his few campaign promises?
Rajoy must take reins swiftly to avoid economic chaos
Mariano Rajoy’s resounding election win has redrawn Spain’s political map and put his Popular Party (PP) firmly in control of the country after seven-and-a-half years of Socialist government. He could hardly face a more difficult task on being voted prime minister. In the days leading up to the election, Spain’s economy was being battered by the markets, with its bond prices close to those of beleaguered Italy. Italy hopes it has just overcome its own political upheaval; Spain’s situation is less clear-cut. Spanish law dictates a lengthy hiatus between a prime minister’s election win and his instatement. José Luis Rodríguez Zapatero’s successor as prime minister was not due to be sworn … [Read more...] about Rajoy must take reins swiftly to avoid economic chaos
Right sweeps to power in Spain, but don’t expect “miracles”
"There will be no miracles, I didn't promise any," PP leader Mariano Rajoy declared pragmatically on Sunday night after his party took almost 45 percent of the vote, winning an absolute majority in Congress in its strongest ever election result. With 186 seats in the 350-seat Congress, Rajoy, who is due to take office in a month, will have a virtually free hand to carry out reforms, although no one knows for sure what steps the new government plans to take to end years of recession and anaemic growth, the euro zone's highest unemployment rate and an escalating debt crisis. Having kept his cards close to his chest throughout the campaign, Rajoy will now be expected to show them - … [Read more...] about Right sweeps to power in Spain, but don’t expect “miracles”
Ahead of election, Spain’s next prime minister leaves everyone guessing
Mariano Rajoy, leader of the opposition Popular Party, is set to put two election defeats behind him on November 20 and become Spain’s next prime minister. But his all-but-guaranteed victory (opinion polls suggest the PP will win around 190 seats in the 350-seat parliament, its largest ever majority) has little to do with him. Instead, it has much more to do with a three-year economic crisis, an intractable unemployment disaster and escalating worries about Spain’s debt and public account deficits – problems, compounded, if not induced in the eyes of many, by the economic mismanagement of the current Socialist administration of Prime Minister José Luis Rodríguez Zapatero. Those issues, … [Read more...] about Ahead of election, Spain’s next prime minister leaves everyone guessing
Spain’s Socialists scuttle the ship
The legislature is limping to a close. Since José Luis Rodríguez Zapatero's conversion to market orthodoxy in the spring of 2010, the prime minister has made no secret of the fact that his sole obsession is to sail the Spanish ship clear of the turbulent waters of a bailout, and he seems set to succeed. But his government's final manoeuvres have unfortunately had the effect of scuttling the lifeboat of Socialism driven by the party's chosen candidate for the November 20 elections. Alfredo Pérez Rubalcaba is an able seaman, but he is navigating into an electoral storm made even worse by the last acts of his former Cabinet colleagues. First came the tawdry deal with the Popular Party (PP) … [Read more...] about Spain’s Socialists scuttle the ship
Thrifty newcomer may be just the ticket in profligate Portugal
Pedro Passos Coelho, Portugal’s prime minister-elect, does not like wasting money. Both in his professional career and personal life, he has been described as thrifty, frugal, even tight-fisted. He currently lives in a standard apartment block in the none-too-fashionable Lisbon district of Amadora, but if he moves into the prime minister’s residence near the São Bento Palace his stinginess may come in handy in solving Portugal’s debt and deficit crisis. That, at least, appears to be what many Portuguese were thinking when they handed victory to Passos Coelho’s centre-right Social Democrats (PSD) in last Sunday’s general election, coupled with a desire to get rid of the Socialist … [Read more...] about Thrifty newcomer may be just the ticket in profligate Portugal