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Euro zone focus on Spain

Friday, September 14, 2012 - 01:50

Sept. 14 - Europe's finance ministers and officials met for talks in Cyprus, with Spain's borrowing costs and Greece topping the agenda. Joanne Nicholson reports

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Spain's finance minister came to Cyprus feeling the heat to spell out if his country needs more financial support. Luis de Guindos told his euro zone counterparts, and European chiefs, it will present a new set of structural economic reforms by the end of the month. SOUNDBITE: Spanish Finance Minister Luis De Guindos Jurado, saying (Spanish) : "What Spain needs to do is adjust its deficit, its public deficit to the level we are committed to. We already have a decisive process. And then some economic reforms in the European semester, that's where Spain's commitment lies and those of our European partners." Madrid's borrowing costs have fallen since the European Central Bank said it was ready to buy its bonds. And that will tempt Spain, and EU paymaster Germany, to try to get by without any help. But the scale of debt repayments it faces before the end of the year, and a deepening recession mean many believe it only a matter of time before it asks for aid. Greece's finance minister was in Cyprus, at the end of a week where the troika of lenders has been assessing its spending reduction programme. There's pressure on Greece to make further cuts so it can receive a tranche of money from its bailout programme. The IMF's head, Christine Lagarde, said they'd consider giving Greece more time. SOUNDBITE IMF Managing Director, Christine Lagarde, saying (English): "It seems to us quite clear that Greece has already produced a huge effort but will have to continue to do so and the targets when it comes to achieving debt sustainability is very high. So, there are various ways to adjust." The group also has a mammoth task of overhauling the way banks are regulated in Europe. Joanne Nicholson, Reuters

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Euro zone focus on Spain

Friday, September 14, 2012 - 01:50