Economy is “changing cycle,” Rajoy tells US Chamber of Commerce

Labor reforms are government's biggest achievement, PM explains

Rajoy during his speech to the US Chamber of Commerce.
Rajoy during his speech to the US Chamber of Commerce. EFE

Under the slogan “Spain: back to growth, ready for jobs,” Prime Minister Mariano Rajoy on Tuesday told the US Chamber of Commerce that the Spanish economy, as well as Europe as a whole, is well on its way to recovery.

After two years of intense reforms, Rajoy said that Spain is “is undergoing a change of cycle,” passing from recession to growth, although he did admit that dealing with the country’s high unemployment rate is still going to be a challenge.

“Today, there are no doubts on whether the euro will continue to exist,” he said. “No one is talking about the rescue of Spain or of any other country in Europe; the risk premium [i.e. Spain’s borrowing costs] is no longer a problem, but we should improve it; and no one is talking about recession because we have already emerged from it.”

Rajoy spoke to around 150 members of the Chamber – which is the world’s largest business organization, with 3.5 million members – the day after he had a meeting at the White House with President Barack Obama, who praised the Spanish government for its recovery efforts.

More than 700 US companies are headquartered in Spain, employing more than 240,000 people

Touching on his reforms, Rajoy said that the biggest accomplishment of his government was the structural changes to the labor market and industry, which have made Spain more competitive and were what he described as “the pillar of recovery.”

After painting a grim picture of what the Spanish economy was like when he arrived in office in 2011, Rajoy said Spain “is still on the road to overcoming its difficulties” but added that there was more hope now than there was two years ago.

He reminded the Chamber, which is the US counterpart to and partner of the Spanish CEOE business confederation, that the United States was one of Spain’s most important trading partners. The United States is the number-one destination for Spanish exports outside of Europe, and the third-largest destination for Spanish investment outside the continent, Rajoy explained.

More than 700 US companies are headquartered in Spain, employing more than 240,000 people, he said. After the signing of a treaty last year to protect US companies from double taxation, the Spanish government predicts that US investment in Spain will grow to 43 billion euros and create another 170,000 jobs.

Calling bilateral trade relations between the country “excellent,” Rajoy said that his “government will work hard to strengthen the relationship, because it will be beneficial for all of us.”

Afterwards, Chamber President Thomas Donohue asked a few questions that allowed Rajoy to expand on his outlook for the economy. The prime minister reminded the Chamber that in 2001, while he was serving as interior minister under Prime Minister José María Aznar, he was one of the first European officials to travel to the United States following the attacks on the World Trade Center and the Pentagon, with the aim of pledging Spain’s full cooperation in the fight against terrorism.

At the Chamber, Rajoy was accompanied by some of Spain’s leading businessmen, including Florentino Pérez (ACS), Isidro Fainé (Caixa Bank), Antoni Brufau (Repsol), José Manuel Entrecanales (Acciona), Ignacio Sánchez Galán (Iberdrola) and Javier Monzón (Indra). CEOE president Juan Rosell was also present.


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