video transcript

European Central Bank President Mario Draghi says the euro zone economy faces a long, uphill road to recovery. He said the bloc is still suffering from a crisis of confidence and that there was no alternative to continued budget cuts. In a testimony to the European Parliament, Draghi also said the ECB's new bond-purchase programme for troubled countries such as Spain would provide a backstop to avoid destructive scenarios in the 17-country euro zone. The ECB agreed the plan last month and financial markets are now looking for any signs Spain might make a formal aid request that would trigger intervention in bond markets. (SOUNDBITE) (English) EUROPEAN CENTRAL BANK PRESIDENT, MARIO DRAGHI SAYING: "The ECB stands ready to undertake under appropriate conditions what we've called 'outright monetary transactions', OMTs. These will provide a fully effective backstop to avoid destructive scenarios that might threaten price stability in the euro area. "Some things have improved in the last to two or three months, but I think the road ahead of us is still long and it's an uphill." "It is without doubt that the process of fiscal consolidation in the short term will depress, and has depressed, the output in different parts of the euro area. But what's the alternative?"