Spain to unveil rescue plan for virus-hit economy

Facing resurgent virus infections, Spain’s government will on Wednesday unveil a recovery plan aimed at yanking the country out of its worst economic slump in decades.

The pandemic has pulverised Spain’s tourism-dependent economy, with the government warning Tuesday that GDP would fall by 11.2 percent this year, down from a previous prediction in May for a 9.2 percent decline.

It sees the jobless rate jumping to 17.1 percent this year while the public deficit should hit 11.3 percent of economic output.

Against this grim backdrop, Prime Minister Pedro Sanchez will unveil the details of his leftist government’s “Recovery and Resilience Plan” at 11 am (0900 GMT).

The measures will be financed by 140 billion euros ($165 billion) in grants and loans which Spain will receive from the historic 750-billion-euro rescue plan agreed by the European Union in July.

“The virus exists and our obligation is to fight it with all our might, and then… to channel these forces into a historic accelerator to transform our country. We can’t lose this huge opportunity,” Sanchez said last month.

Sanchez’s minority government has linked passage of the measures to approval of its 2021 budget as a way to pressure smaller parties to support it.

The economic recovery plan will encourage investment in the economy’s digital transformation, the transition to greener energy sources and greater gender equality at work, in line with EU objectives. (AFP | Álvaro VILLALOBOS)

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