DEBT CRISIS

Canaries joins growing list of regions that need bailout

Request from sixth administration means liquidity fund is almost fully accounted for

Santa Cruz de la Palma - 05 Oct 2012 - 18:17 UTC

The Canary Islands on Friday became the sixth Spanish region to seek a bailout from the central government’s rescue fund.

The region’s economic commissioner, Javier González Ortiz, said the Canary Island will seek 756.8 million euros from the Regional Liquidity Fund (FLA), which is being set up with resources of 18 billion euros. The FLA will be in existence until the end of this year

González Ortiz insisted the Canary Islands were tapping the FLA because the funding conditions were more accessible than those currently available in the market, “not because the region’s solvency is in doubt.” He said the Canaries have the lowest debt per capita ratio among the country’s 17 regions.

The Canary Islands’ petition brings total requests from the country’s cash-strapped regions to around 16.3 billion euros. Andalusia needs close to five billion euros, Catalonia has requested just over five billion and Valencia 4.5 billion.

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