Spanish economy registers zero growth in third quarter

19:10, November 05, 2010      

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The Spanish economy registered zero growth in the third quarter this year, according to figures released Friday.

The data released by the Bank of Spain (BOE) show the period between July and September saw Spain's economy stop expanding after seven quarters in which it had shown continued but slow growth.

The economy has, however, grown by 0.2 percent in comparison with the same period last year.

Growth was 0.1 percent in the first quarter of 2010 and 0.2 percent in the second.

The Bank of Spain attributed the stagnation to several factors, including the end of the Spanish government's Plan2000E, which saw public money destined into public works schemes designed to promote employment, as well as into the car industry.

That plan came to an end with the need to reduce spending to combat Spain's deficit, which currently stands at slightly over 9 percent of GNP (gross national product).

"The figures are down to weak activity and the transitory character of the economy," said the BOE, which added taht the July increase in sales tax, which the International Monetary Fund praised, had been a factor in reduced demand.

The lack of expansion in the economy was reflected in the unemployment figures released for October at the start of this week. They showed an increase of 68,213 in the number of people out of work to a total of 4,085,976.

Although the economy has grown by 0.2 percent in the past 12 months, there are now 277,623 more people unemployed than at the end of October 2009.

Source: Xinhua


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