Catalonia asks Spain for further 9bn euros bailout
- 29 January 2013
- From the section Europe
The independence-minded region of Catalonia has asked the Spanish central government for an extra 9bn euros (£7.7bn) in bailout money.
Catalonia's regional government said it needed the money to pay down debts and meet deficit reduction targets.
It adds to the 5bn euros the debt-stricken region initially requested from Spain in August last year.
The move comes just a month after Catalonia's new leaders pledged to hold a referendum on independence.
Catalonia is prosperous and accounts for around a fifth of Spain's GDP, but faces debt repayments totalling 13.6bn euros this year alone.
The regional government said it would spend 7.7bn euros to pay down debt and the rest on meeting deficit reduction targets set by the Spanish government.
Last year Spain set up a regional liquidity fund to provide money to regions unable to borrow on the international markets as a result of the financial crisis.
This year it has 23bn euros available to regions struggling with debt, raised from the treasury, Spanish banks and the national lottery.
Spain has been among the eurozone countries worst hit by the financial crisis.
It has been forced to borrow heavily as a result of a collapsing property market, recession and the highest unemployment rate in the eurozone.
Catalonia's nationalist leaders have blamed the Spanish government for the region's financial problems, and the economic crisis has broadly strengthened nationalist sentiment.
Catalan President Artur Mas formed a pro-independence coalition following elections in November, and in December agreed with coalition partners to hold an independence referendum by 2014.
The Spanish government led by Prime Minister Mariano Rajoy is fiercely opposed to Catalan secession, and argues that a referendum would be unconstitutional.