From strikes in Italy and bailouts in Ireland, European countries' finances are in tatters as they face the headwinds of recession. But what is the situation really like in Spain? Larry Elliott of the Guardian writes: 

www.guardian.co.uk, Tuesday 6 September 2011 20.53 BST

By Larry Elliott

Another day, another denial from Spain that it has come close to requiring a bailout. Spain's finance minister, Elena Salgado, rejected suggestions on Tuesday that the country nearly called in the International Monetary Fund (IMF) last month, after a Spanish union leader reported that prime minister José Luis Rodríguez Zapatero had told union and business leaders he had seen "the edge of the abyss, in the form of a bailout for the Spanish economy". Whatever the truth, Spain is in deep trouble. To cut its borrowing requirement, the country has just started a privatisation programme, which includes selling a 30% stake in the national lottery, which it hopes will raise €9bn (£7.9bn), and part of the state airport authority.

The latest data has caused economists to fret that Spain may be heading towards recession.

This is an extract from a longer article by Larry Elliott which assesses the economic situation in each country in Europe: European debt crisis: country by country financial analysis

© Paul Whitelock

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