Spanish PM sells economic recovery on official trip to China

Rajoy assures investors that Spain’s economy is growing three times faster than euro-zone average

Mariano Rajoy arrives in China.
Mariano Rajoy arrives in China.Diego Crespo / EFE

Spanish Prime Minister Mariano Rajoy has traveled to China intent on hammering home the message to investors that his country’s economic recovery is well underway. According to government sources, the PM is particularly interested in using the official visit to wrap up agreements that are already in their closing stages, between companies such as online retailer Alibaba – dubbed the Chinese Amazon – and Spanish textile giant Inditex, as well as between others in the food and agriculture sectors, such as China’s Fosum and Spain’s Osborne.

Even though the Bank of Spain and Economy Minister Luis de Guindos have been sending out messages of caution regarding the recovery in Spain, which has been adversely affected by a slowdown in the euro zone, Rajoy is trying to get a different idea across in China. In particular, he has been making comparisons regarding the situation he found when he arrived in government, and how things are now.

Speaking at an economic forum in Shanghai, the prime minister told Chinese business leaders that Spain saved itself from a bailout, making “some of the most intense budgetary cuts seen among the developed economies,” as well as cleaning up its financial system and approving a labor reform that “granted more flexibility to companies.”

The Bank of Spain and the economy minister have been sending out messages of caution regarding the recovery

“The economic situation in Spain is now diametrically opposed to the one we found ourselves in three years ago, thanks to a definitive change in the direction of economic policy […],” he said in his speech. “Spain has turned the situation around and is growing, creating jobs, exporting, investing and doing so in a sustained and sustainable way.”

The PM insisted that Spain was growing three times faster than the euro-zone average, opting to ignore the doubts expressed by Spain’s central bank and his own economy minister. “Right now Spain is growing at a faster rate than its neighbors in the euro zone, and what’s even more important, it has established solid bases so that this can continue over the next few years, and do so in a sustainable way,” Rajoy continued.

Rajoy’s official visit to China had been delayed on a number of occasions for political reasons, in particular because of its insistence that Spain make changes to its universal justice legislation, given that a case was being brought against the previous Chinese administration in the Spanish courts for genocide in Tibet.

The Spanish prime minister left for the trip amid a political storm on Tuesday, after his justice minister, Alberto Ruiz-Gallardón, resigned from his post and left politics altogether because of a lack of support for his plans to reform Spain’s abortion laws.

After the forum concluded, Rajoy met the mayor of Shanghai, before traveling to Beijing, where he will meet both the Chinese president and prime minister.