Spain said on Wednesday it would restore €500m cut from the state infrastructure investment budget for next year in a slight easing of its austerity plans, but would fulfil its promises to keep cutting the annual budget deficit in line with agreed targets.
Spanish officials say the extra €500m – which represents only about 0.05 per cent of the country’s gross domestic product – was made possible in part because the cost of servicing the country’s debt is lower than forecast. :)
Ms Salgado insisted that Spain remained on track to meet its budget targets, with the deficit expected to fall from 11.2 per cent of GDP in 2009 to 9.3 per cent this year, 6 per cent in 2011, 4.4 per cent in 2012 and 3 per cent – the nominal European Union limit – in 2013.
Hungary has revealed that it was asked by North Korea to write-off more than 90 per cent of its outstanding debt in the latest indication of the secretive totalitarian regime’s financial distress. Hungary’s economy ministry told the Financial Times that North Korean negotiators had tabled the request in November 2008 during a meeting in Pyongyang. The revelation follows a report in the FT last week that Pyongyang had asked the Czech Republic to write-off 95 per cent of its Kc186m ($10m) debt. The cash-strapped totalitarian state offered to settle 5 per cent of the debt in ginseng, a root that is said to combat lethargy and impotence.