'Spain deeper in recession than thought'

A new report shows that Spainâ„¢s recession is far worse than predicted for the past two years, as the countryâ„¢s economy contracted 1.6 percent in 2012.

The Spanish economy, the eurozoneâ„¢s fourth largest, shrank more than the estimated 1.4 percent, the National Statistics Institute said Tuesday.

Spainâ„¢s economy also hit a low point in 2011 when it increased by only 0.1 percent and not the 0.4 percent growth earlier announced, revised figures showed.

Moreover, the countryâ„¢s economy contracted for the seventh consecutive quarter as the gross domestic product (GDP) shrank by 0.5 percent in the first three months of 2013.

The figures of contraction show the extent of Spainâ„¢s struggle to recover from the 2008 property market crash that affected millions of jobs and increased the national debt.

The government of Prime Minister Mariano Rajoy predicts a 1.3-percent economic decline this year, while the Bank of Spain said earlier this week that the recession will extend into the second quarter of the current year.

The jobless rate in the country has reached a record high of 27 percent in May. The official figures show that the total number of unemployed people has passed the five million mark.

Spain is in the grip of a double dip recession, which has driven its unemployment rate to 55 percent among those aged 16 to 24.

Battered by the global financial downturn, the Spanish economy collapsed into recession in the second half of 2008, taking millions of jobs with it.

Spain must lower its deficit to 4.5 percent in 2013 and 2.8 percent in 2014. Many economists, however, say those targets will be difficult to meet amid poor prospects for Spainâ„¢s economic recovery.

The Spanish government has also been sharply criticized over its austerity measures that are hitting the middle and working classes the hardest.

GMA/PR

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Republished from: Press TV