Spain's Parliament to invite ECB's Draghi to discuss debt plan

MADRID Tue Oct 30, 2012 7:33am EDT

MADRID (Reuters) - Spain's parliament will invite European Central Bank chief Mario Draghi to discuss the bond-buying programme that investors and euro zone policymakers have been urging Madrid to seek.

Despite deep recession that has made investors doubt Madrid can avoid a bailout, Spanish Prime Minister Mariano Rajoy has so far avoided seeking the precautionary credit line from the euro zone that would trigger Draghi's bond-buying scheme and hold down the country's borrowing costs.

The ECB head last week gave a robust defense of his bond-buying plan in a two-hour closed-door meeting with skeptical German lawmakers. It was a rare appearance for an ECB leader in a national legislature.

Rajoy has said he wants to know more about the conditions for the aid and the mechanics of the ECB bond-buying, but a senior government source has said the prime minister is convinced he will eventually have to make the application.

A spokeswoman at the lower house said on Tuesday that all the major parties had agreed on the invitation, which parliamentary leader Jesus Posada, of the conservative ruling People's Party, will send to Draghi.

The spokeswoman said it was not yet decided whether Draghi would be invited to speak publicly to the full lower house, or to meet in a private session with selected lawmakers.

The opposition Socialist party proposed inviting Draghi, and other parties in Congress agreed.

"Taking into account that the bond-buying programme will have a major effect on Spain ... it would be very interesting to have Mr. Draghi, as the euro zone's top monetary authority, meet with representatives of political parties in the lower house, to exchange opinions and ideas about European Central Bank policy, and in particular, the said programme," said the letter the Socialists sent to Posada. (Writing by Fiona Ortiz; Editing by Ruth Pitchford)

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