Crisis in spain

Crisis in Spain
-Diego

CONTENTS
    

Introduction Spain. Present condition. Solution. Conclusion.

Euro Zone


It currently consists of: Austria, Belgium, Cyprus, Finland,France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands,Portugal, Slovakia, Slovenia and Spain.

Introduction to Euro Zone crisis
  

Due to global financial crisis that beganin 2007-08. The official figures were released in 2009 Jan. On 11 Oct 2008, a summit was held in Paris by the Euro group heads of state and government.

Beginning of Crisis
 

Started in – Oct2009 in Greece Its immediate causes lie with the US crisis of 2007-09.

What Happened and Why? Spain
  

Sharp Budget Deficit Large External Debts in PIIGS. Spain credit rating downgraded.(Need for external aid)

Reasons for rise in External Debts: household indebtedness.  Weakening export competitiveness.  Large current account deficit. Reasons for rise in Internal Debts:
 Rising High

Unemployment.  Construction Problems

PRESENT SITUATION

IMPACT


Contagion Effect: -Spain crisis has made investors nervous. Reduced wealth: -Take-home pay is likely to fallImpact on private individuals:





Resolutions


European governments and the International Monetary Fund (IMF) have stunned global stock markets with a 750bn-euro.



France agrees topitch in with 17 billion euro.

PROBLEMS


It combines unefficient and indiscipline economies.



Too high debts.



Political problems.

SOLUTIONS
Countries affected must: -Grind down Wages - Raise Productivity - Slash Spending - Raise taxes - Transparent Banking system - Endure such Austerity Drives for many years


FUTURE PREDICTED


Either the euro zone shouldgo for integrating their economic policies. OR,



It collapses

CONCLUSION
The US crisis led to Global financial crisis, which further spread to Europe.  Improved transport infrastructure...