Germany, Spain leaders hold talks over fiscal crisis - Xinhua

BEIJING, Feb. 4 (Xinhuanet) --Visiting German Chancellor Angela Merkel has met with Spanish Prime Minister Jose Luis Rodriguez Zapatero in Madrid. The meeting comes as euro zone nations ponder ways of saving EU countries in fiscal crisis.

German Chancellor Angela Merkel says Spain is on the right road with its crisis measures and pledged the euro zone would take crucial steps by March to strengthen economic stability.

A show of unity from two countries with very different economic challenges.

The German Chancellor Angela Merkel spent eight hours with her Spanish counterpart Jose Rodriguez Zapatero.

On the agenda at the Madrid summit - the debt crisis, the euro zone rescue fund and Germany's call for euro-wide fiscal rules.

Merkel said, "Change is never easy but changes are taking place around us - sometimes at breath-taking speed - the question is not whether we in Europe are united - with our power slipping - but rather whether are we are united across a continent which is home to progress and innovation."

As both leaders met the European central bank announced it was keeping interest rates at 1 percent for the 21st month in a row.

There was also some good news for Spain - it's borrowing costs fell at a bond auction, largely due to improved investor sentiment towards the euro zone's weaker members.

The Treasury sold 3.5 billion euros in three and five-year debt, in line with its target.

Jose Luis Rodriguez Zapatero said, "The euro is strong but we have to strengthen it further. This strengthening has to come from the work that we are doing at the moment after a year of hard work struggling against the financial crisis and the debt crisis in some euro zone countries."

Markets were calmed last week by better-than-expected news about the exposure of Spain's savings banks to the country's crippled property markets.

New pension reforms were also announced and there are signs that Europe is closer to agreeing changes to the euro zone rescue fund so it could help Spain if need be.

But one in five people in Spain remains unemployed and the government's austerity measures are far from popular.

(Source: CNTV.cn)

Special Report: Global Financial Crisis

 

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