2008–2012 Spanish financial crisis

1. 2008–2012 Spanishfinancial crisis The crisis began as part of the world FINANCIAL CRISIS and continued as part of the EUROPEAN SOVEREIGN DEBT CRISIS, which has affected primarily the southern European states and Ireland. In Spain, the crisis was generated by long-term loans , the building market crash, and a particularly severe increase in unemployment, which rose to 25% .

2. REASONS • Spain´s huge trade deficit which reached staggering 10% of the country´s GDP by the summer of 2008 • The loss of competitiveness against its main trading partners • Inflation rate which had been traditionally higher than those of its European partners Affected by house price increases of 150% from 1998 and growing family indebtedness (115%) chiefly related to the Spanish Real Estate boom and rocketing oil prices.

3. During the third quarter of 2008 the national GDP contracted for the first time in 15 years Spain had officially entered recession • The economy contracted 3.7% in 2009 • Again in 2010 by 0.1% • It grew by 0.7% in 2011 • Now in recession once again (1.7% drop ) On 9 June 2012: Spain needed to apply for a €100 bn for a bank recapitalization.* October 2012: the so- called TROIKA is in negotiations with Spain to establish an economic recovery program.

4. Wave of Evictions • The number of families evicted continues to increase, while the country has many empty homes • Unemployment in Spain Exceeds 25% • Spaniards are losing hope

5. Who have lived beyond their means? The poorest 40% of families spent their housing debts