Talk of the Greek financial crisis spreading to Spain is "unfounded", Spanish Prime Minister Jose Luis Rodriguez Zapatero said today, in a bid to reassure markets about his country's solvency, according to dpa. As Greece struggles to reduce a burgeoning budget deficit, fears spread over the ability of other financially precarious countries in the eurozone - such as Spain and Portugal - to pay off their debts. Share prices in Madrid fell sharply last week. But Zapatero, talking at the end of an EU summit in Brussels where eurozone leaders promised to preserve stability, said such comparisons were groundless. "It's quite evident that the curious attempt we experienced in the past weeks to suggest that our stability and our public finances were under any risk is unfounded," he said. Zapatero stressed that Spain's public debt "is 20 percentage points lower than the European average" and that his country "is issuing 10-year bonds at a lower cost than in February 2004." "This data is telling," he added. On Tuesday the EU's outgoing economy commissioner, Joaquin Almunia, a Spanish socialist like Zapatero, fuelled worries about Spain and Portugal, saying there was "a serious risk of spill-over to other parts of euro area" from the Greek crisis. When questioned on these remarks, Zapatero shrugged and said he "could not get inside Almunia's mind." The Spanish government adopted last week a plan to cut its budget deficit to 9.8 per cent of gross domestic product (GDP) in 2010, and down to 5.3 per cent of GDP by 2012. The eurozone's prescribed limit of 3 per cent would be reached in 2013. "There is no doubt we have to reduce our deficit, as we committed ourselves to. But our strength is quite clear, I hope that everybody will see it," Zapatero concluded.
