Fears about the Greek economy was so last week. We will find out soon enough how the markets respond to this news and whether the EU bailout plan was sufficient. As if this wasn't enough, the NY Times writes today that the UK may have an even deeper hole to dig out of with their financial problems. In the UK, one research group said the country will require a "martyr" to do the right (financial) thing and get the country sorted. Perhaps, but when's the last time the world saw such a politician?
With 20% unemployment, what's next for Spain?
"It is not the first time that the IMF has said Spain needs economic reform, but the language has a much greater sense of urgency," said BBC economics correspondent Andrew Walker.
"The IMF says bluntly, the Spanish labour market is not working and needs reform of pay bargaining and lower payments for fired workers."
Last week, the Spanish government approved a 15bn euro austerity plan, including a 5% cut to public sector salaries, as it aims to reduce its deficit.
Spain is also having to cope with unemployment of more than 20%.
Concerns about the Spanish economy have to be seen in the light of the recent financial crisis in Greece, which has a deficit amounting to 13.6% of GDP.
