Spanish ministers approved Friday a wide-ranging 10-year reform plan designed to wean the economy off its dependence on construction and create broader, more sustainable growth as the country fights to climb out of recession.
The bill, which now goes before Parliament, features everything from tighter supervision of the financial sector — and forcing listed companies to tell shareholders how much their executives earn — to measures making it easier for Spaniards to start up small businesses.
The plan also calls for bigger tax breaks for companies that invest in research and development, more help for Spanish exporters and changes that force government agencies and other businesses to pay faster for services or goods bought from private-sector suppliers.
It also boosts vocational training in a country that turns out armies of university graduates who often end up underemployed.
Prime Minister Jose Luis Rodriguez Zapatero called the bill essential to Spain's present and future: "For the present because it must contribute to economic recovery and returning to the path of job creation, and for the future because it is a key piece for a new growth pattern."
Spain, once among Europe's largest creators of jobs and boasting more than a decade of solid GDP growth, is now suffering its worst recession in decades. It has been in recession since the third quarter of 2008 after the collapse of a boom fueled by residential construction. The building sector and related industries had accounted for nearly 20 percent of the country's economic output.
Now, the unemployment rate is at a euro zone high of nearly 19 percent after roughly doubling in less than two years, and is projected to hit 20 percent or more. While the broader euro zone has climbed out of recession, Spain is not expected to post year-on-year growth until 2011.
Zapatero's government first unveiled the reform package late last year, and conservatives have given it a tepid welcome, saying it lacks key ideas like loosening up rigid labor laws blamed for discouraging companies from hiring.
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