Rajoy stays his course

On Wednesday, Spanish Prime Minister Mariano Rajoy defended his conservative government's economic austerity and reform course, saying that the country had left behind the threat of imminent failure through a disciplined budget consolidation policy. He said that Spain had curbed its yawning public deficit to less than 7 percent of gross domestic product in 2012, down from 9.4 percent a year earlier.

Delivering his first state-of-the-nation address, Rajoy said that he was well aware of the country's record jobless rate of over 26 percent, but he emphasized that there was no alternative to the current austerity drive.

"We have achieved the twin task of avoiding the shipwreck that threatened our country and launching the reforms needed for our production system," Rajoy said.

Rajoy announced what he called "a second generation of reforms" to fuel the recession-hit economy. He said that Madrid would mobilize 45 billion euros ($60 billion) in financial assistance to mostly small and medium-sized enterprises.

Fighting on two fronts

The prime minister also insisted that Spain was not a corrupt nation, fighting off recent allegations that he and other party leaders had accepted regular secret payments from the private sector for almost two decades.

"Spain is a clean country going through tough times in which cases of corruption emerge just like in any other country," he remarked in his address.

Rajoy proposed that the finances of all public officials be audited at the end of their mandates. He also announced that the statute of limitations would be extended for corruption-related offenses.

hg/mkg (dpa, AFP)