The Economy minister stated "I have hope that this was the worst quarter. From here on we will improve. Businesses are doing what they have to do: seeking an exit through foreign markets," Allard added."If the government pursues its promised reforms that will also help. In training, in collective bargaining, in unemployment benefits and the duplication of work in the public sector... there is a lot that can be done."Economy Minister Luis de Guindos said in Davos, Switzerland on Friday that he expected the economy to return to growth in the second half of 2013.
But activity is being curbed by his government's programme of spending cuts and tax rises, aimed at saving €150bn between 2012 and 2014, prompting mass street protests.The government has vowed to lower the public deficit from the equivalent of 9.4 percent of annual gross domestic product in 2011 to 6.3% in 2012, 4.5% in 2013 and 2.8% in 2014.
Analysts say those targets will be hard to reach in a period of declining economic activity.
On Tuesday, for example, the northeastern government of Catalonia requested €9 billion from a rescue fund created by Spain to save its financially beleaguered regions.
Of the total amount, €7.7 billon would be earmarked to pay out maturing debt and international loans, the statement said, and the remainder set aside to ensure the region reaches a 2013 deficit target of 0.7% of GDP imposed by the central Spanish government of Prime Minister Mariano Rajoy.
The request came less than a week after Catalonia's parliament approved a declaration of sovereignty that could lead to a vote on self-determination for the region whose leaders want greater autonomy from Spain.
Proud of their distinct language and culture, many Catalans blame the region's financial difficulties on tax income redistributed to other regions of Spain.Catalonia is home to 7.5 million of Spain's total population of 46 million. It accounts for more than a fifth of Spain's economic output and a quarter of its exports. (Source: AFP, TELEGRAPH)