19 Pages Posted: 18 Aug 2013
Date Written: August 18, 2013
The Spanish economy continues to contract as it undergoes a difficult process of correcting pre-crisis imbalances. The challenge of this adjustment has been exacerbated by weak economic conditions in many of Spain’s main trading partners and by continued financial market fragmentation within the euro area. Spain is undertaking a major program of financial sector reform with support from the European Stability Mechanism (ESM). On June 25, 2012, Spain requested financial assistance from the European Financial Stability Facility (EFSF) to support the ongoing restructuring and recapitalization of its financial sector. The Eurogroup approved this support for Spain. This paper deals with the present economic condition in Spain and the dynamic changes in the financial market present in Spain with reference to its financial instruments.
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