Spain urged to spend less on infrastructure projects and more on the real economy

The European Commissioner for Regional Development, Johannes Hahn, has said that Spain must spend more of its European funding on the ‘real economy’ and less on grandiose infrastructure projects, adding that the regions should introduce specialised economic strategies based upon the strengths of each region.

The idea is that regional development funds be used to stimulate growth and create employment, such as through employment training and vocational courses. The Commissioner said that Spain needs to invest more in innovation and strengthening the small and medium-sized businesses, the backbone of the economy.

In the past year, one billion euros has been distributed to Spain to combat youth unemployment, particularly through training schemes, but the ultimate goal should be to offer more jobs, according to Mr Hahn. He said that it is demoralising for young people to attend several training courses yet remain without a job opportunity.

Youth unemployment in Spain, and Greece for that matter, currently stands at 55%, compared to 10% in Germany and Austria where training schemes and allied projects have been in place for decades.

If Spain is persuaded to follow the example of other countries with training programmes and regional economic specialisation, Mr Hahn believes that it will take five to ten years to reap the rewards.

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