Model Patient Rajoy: Spain Has Much to Offer

The Spanish Prime Minister Mariano Rajoy tells how his country went from the sick man of Europe to a model for reform in a short time, and explains what the European community can expect from Spain moving forward.
Spain may be on a good path, but it has been often rocked by protests too. Source. Imago/ Zuma

In April 2011, eight months before I took office as Prime Minister of Spain, I had the opportunity to speak at the Konrad Adenauer Foundation in Berlin. My country was at that time – and the memory still leaves a lingering pain – in the midst of the most severe crisis that we have ever experienced.

In the previous three years, more than 3.4 million of my compatriots had lost their jobs, we had a negative rate of GDP growth and the budget deficit was unsustainable. The financial system urgently needed a restructuring. Add to that the national debt, an uncontrolled increase in prices and difficulties with financing our economy, and a terrible storm was building in the skies over our country. Back then we were the “sick man of Europe." And as a leader of the opposition at that time, I wanted to address the question that all of Europe was asking: "What can we expect of Spain?"

Despite this difficult time, many of us were convinced that our country would be more than capable of overcoming the crisis but it certainly would not be easy. I was able to present my plan for far-reaching reform for Spain in Berlin.

It was clear that Spain would need profound structural reforms at the national level and even the European level to return to the path of economic and employment growth. We knew this would be far from easy. And that we would have to rely on an essential key element: the consent and help of Spanish society. This is mainly because, in addition to all the existing problems, we also had to tackle the challenges of the euro crisis, our meteoric rising borrowing costs and the pressure that we, like other European countries too, needed to go through the euro-zone bailout fund process.

The return of foreign investors to Spain speaks clearly to the new confidence that Spain deservedly enjoys today.

Following my election in December 2011, Spain launched one of the biggest reform projects in recent history. And this certainly answered any questions of what Europe could expect of Spain. The whole world witnessed how our country went from the sick man of Europe to the forefront of recovery in a very short time. The reforms have created new realities in my country.

Just look at the numbers: Spain saw the creation of more than 1 million new jobs in 2014 and 2015. Who could have predicted this? Our economy will grow by 3.3 percent this year. Spain will be the European leader of new jobs and economic growth this year.

This is encouraging, but there are other reasons for optimism. Thanks to strong efforts with our austerity policies, we are expecting to turn an unbearably high budget deficit of 9 percent of GDP in 2011 to a surplus in 2016. We will also leave the EU’s excessive deficit process in the same year.

Thanks to the restructured financial system, thanks to very favorable conditions in international financial markets, and thanks to price controls and our foreign trade, where we’ve seen new export records, today the Spanish economy is on a dramatic upswing in terms of competitiveness.

The return of foreign investors to Spain speaks clearly to the new confidence that Spain deservedly enjoys today. And it makes me happy that the commitment of German companies underlines our establishment as an industrial platform in southern Europe.

We still have a long way to go. No one can deny that. And yet I think in all modesty, that the Spanish successes this year are a good reason to look to Europe with hope for the future. As I said in Berlin in 2011, we need an overarching policy that is characterized by stability, willingness to reform, rigor, responsibility and thrift, in Germany and in Spain – where we’re proud to be referred to as "the Germans of the South" – and across Europe.

Our cooperation in the fight against terrorism and our commitment to stabilization missions on the African continent speak for themselves.

This policy is the basis of medium and long-term sustainability of our social welfare state. It contributes to the European project, because it promotes general welfare and expresses a pro-European commitment. This should be an obvious duty when a nation enjoys the many benefits of belonging to the E.U.

The Spanish experience is proof that this is the right way to bring about economic wellbeing. At the same time, it underlines that the opposite, i.e. an unwillingness to reform, is not only harmful to the European project, but directly detrimental to the prosperity of a country’s citizens.

The Spanish commitment to Europe extends to many areas that currently play a key role on the European agenda, including such important global issues as migration and security. Despite the great economic and political costs, my country has successfully acted as a guarantor of the southern external border of the European Union.

And because this common challenge unites us, we are happy to contribute our valuable experience in the development of European policies for the efficient control of global migration, from dialogue and cooperation with countries of origin and transit countries, to repatriation agreements.

Our responsibility as an international player in Europe, of course, also includes solidarity: We are a partner who tackles common challenges and wants to contribute. Our cooperation in the fight against terrorism and our commitment to stabilization missions on the African continent speak for themselves. In short, our partners can expect this level of responsibility and solidarity from Spain.

Spain has much more to offer, and the millions of Germans who visit my country every year know this. Our culture can be found all over the world. We are in every respect a stable and secure country. In addition, our geographical location, our history and our language give us a privileged access to dialogue with such important strategic areas such as the Mediterranean and Latin America.

These are some of the great strengths that Spaniards can bring to the European project. And given the new horizons that are opening up in my country, we are an even more valuable asset than ever. What you can really expect from Spain in 2015 is a happier and a better future.

 

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