Spain’s budget figures
We are getting that deja vú feeling again. Spain has suddenly been spending 90 billion Euros more than estimated. How they calculate these figures, nobody knows, but this sure is resembling the Greek saga. 90 Billion Euros is the size of the Portugese bail out by the way.
On the other hand, when it comes to the property sector, we would really enjoy trying to understand the explanations on out how the banks are valuing all those “cheap” properties they hold in their prop book. Expect cheap properties to become cheaper, while the budget blame game resumes.
Spain is at risk of a test case and possible fine under new EU rules for a “grave” breach of budget limits, the European Commission said on Monday.
The overshoot amounted to tens of billions of euros, it said.
“We need to shed full light on what went on Spain in 2011,” EU Economy Commissioner Olli Rehn’s spokesman Amadeu Altafaj said of what he called a “serious, grave” gap in the figures.
Altafaj said Madrid warned Brussels on December 30 of a slide of two percentage points compared with output on its deficit target for 2011, then another half a percentage point two days ago.
Spain’s 2011 public deficit was supposed to come in at 6.0 percent of gross domestic product (GDP) but at 8.5 percent, that meant the state spent 90 billion euros ($119 billion) more than it took in last year. (Full article here).