Spanish PM calls for calm, warns of ‘difficult weeks’ ahead due to coronavirus crisis

In an atmosphere that reflected the complexity of the situation caused by the novel coronavirus crisis, Spanish Prime Minister Pedro Sánchez spoke on Tuesday evening from La Moncloa prime ministerial palace to announce economic assistance for companies and families who are suffering from the epidemic. The aid will be particularly aimed at parents who are unable to go to work and need to take care of their children, as well as the sectors that have been most affected by the outbreak.

The Socialist Party (PSOE) politician also promised liquidity for small- and medium-sized companies, and warned that there would be “difficult weeks” ahead in Spain. He did, however, announce that he had achieved progress in a meeting with his European partners: the European Union would be more flexible on the deficit targets for the countries most affected by Covid-19, as the disease caused by the virus is known. This will include Spain and Italy.

Faced with a complex crisis, the Spanish government is demonstrating its capacity for action

Prime Minister Pedro Sánchez

The Spanish government has not been the first to announce major aid packages aimed at counteracting the economic effects of the coronavirus crisis. A number of European Union partners have already put numbers on their stimulus plans. But the executive is now prepared to multiply the measures it will implement in order to compensate an economic impact that no one is now denying, and that the prime minister has also recognized.

Spain is now preparing to lower its growth forecasts, although no sources from La Moncloa are yet predicting that the situation could lead to a recession. Since Monday, the coalition government run by the PSOE and the left-wing Unidas Podemos group has radically altered its narrative and yesterday Sánchez detailed the measures that would be finalized today and approved in a Cabinet meeting tomorrow.

Businesses are pressuring the government for assistance for the companies that have been most affected, in particular in sectors such as tourism and transportation, and unions are calling for the executive to help workers who have lost their jobs or have seen their income fall.

There are also calls for assistance for the millions of parents in the Madrid and La Rioja regions, and in the Basque municipalities of Vitoria and Labastida, where all schools and universities have been closed for a two-week period starting on Wednesday. This has left some people with no other option but to miss work, if they are unable to follow the Health Ministry’s recommendations to work from home.

Spain is now preparing to lower its growth forecasts, although no sources from La Moncloa are yet predicting that the situation could lead to a recession

“We will do whatever is necessary to combat this emergency,” the prime minister said on Tuesday, before explaining the details of the extraordinary European Council meeting that took place yesterday via videoconference. EU leaders discussed the possibility of “increasing the flexibility of the rules of the Stability package” for countries such as Spain. The idea is that all of the costs of dealing with the crisis, from health spending to financial support for families and companies, are left outside of the deficit calculation. What’s more, the European Commission will study other measures that it will approve next week, Sánchez explained.

Sánchez has been criticized by opposition parties such as the conservative Popular Party (PP) and far-right Vox for doing too little, too late, and for the “irresponsible” decision to allow mass demonstrations for the March 8 Women’s Day to go ahead across the country on Sunday – just a day before the decision was taken to close schools across the Madrid region.

Sánchez defended himself on Tuesday, stating that he had followed technical criteria with each decision and sought to minimize the talk of political tensions. He went on to say that he had not even perceived such a battle between parties, because in private conversations with the leaders, Pablo Casado (PP) and Santiago Abascal (Vox), the communication was much smoother.

“Faced with a complex crisis, the Spanish government is demonstrating its capacity for action,” the prime minister stated. “Spaniards want to see all of their political leaders united. I have spoken to a number of forces and they have conveyed their willingness to cooperate,” he said, after praising the cooperation between Spain’s regions – who are in charge of their own healthcare systems – and the central Health Ministry. Despite criticism by the opposition, the prime minister had not made a public statement about the crisis until yesterday. For now he has no plans to appear in Spain’s lower house of parliament, the Congress of Deputies.

Sánchez appeared unfazed by the criticism, and on Tuesday focused on calls for calm, including a reference to the panic buying that was seen in some supermarkets on Tuesday, despite there being no supply problems for basic goods in the country.

English version by Simon Hunter.