Is Spain the Next Greece?

Is Spain is the next Greece? Or is it perhaps Portugal or Italy? Although the Greek government promised a new set of ‘hard’ measures to curb the deficit, temporarily limiting the agony of the markets for its financial operators both sides of the Atlantic are considering the risks and potential benefits who constitute the growing debt of other European governments. Although investors welcomed the measures announced yesterday that Athens, analysts warn that the moves might not be enough to avoid an aid to Greece and a “domino effect” that would sweep Europe and the euro hit [EUR = X]
Indeed, several banks and hedge funds have begun to turn their attention to other indebted countries, especially Portugal, Spain, Italy and to a lesser extent Ireland, as outlined in a publication of the newspaper «The New York Times».

“If the problems in Greece are not addressed now, then there is the risk that the market will turn its attention to the next weak ‘chain’, warn analysts. The most vulnerable country after Greece, according to some analysts, is Spain, which has plunged into deep recession. Faced with unemployment around 20%, budget deficit exceeding 10% of GDP and an economy forecast to shrink 0.4% this year, Madrid is little room where the investors’ turn its back “on new bond issuance of 85 billion expected this year. The same vulnerability goes for neighbouring Portugal. The large budget deficits and trade, coupled with the lack of liquidity, making Portugal dependent on foreign investors. And as in Greece, there is probably little political will to reduce spending or increase taxes. This is a completely different picture from Ireland, which was a concern last year. But the new austerity measures, including freezing of salaries of government officials and reduce government salaries, put Ireland in a stronger position, and draws 19 billion this year. Is heavily indebted and Italy, despite being a slightly stronger position than Spain and Portugal, because the economy is expected to grow 0.9% this year and 1% next year.