Op-ed: The real story of Spanish corporate debt

Remember the "Gran Armada" of Spanish companies? Immediately before the crisis, our main companies were tremendous corporate juggernauts capable of transcending borders. Having taken on the most leverage in all of Europe, they were forced to trim debt quickly once the crisis hit in 2008. Have they succeeded? Well, sort of. For right now, aggregate Spanish corporate debt has been cut back 18%, much more than other European countries.

Despite the impressive percentage they were able to trim, the total weight of Spanish debt is still far greater than most countries on the continent. And after agreeing to take a small step toward refinancing in 2009 and 2010, the majority of construction companies and some large banks are once again bundling payments that will be due next year.

They will fight to restructure their financing operations in order to create a more long-term, stable time horizon, while expensive interest rates and Spain's reputation are slowing them down.

And therein lays the main dilemma for Spanish companies. They could sell part of their businesses, but even then they would need to maintain growth levels in order to stay afloat. Something that their thriving foreign ventures are urging them to do.

While Telefónica could have blazed a trail for others to follow, with its acquisitions, the telecom has increased its debt, but managed to deleverage, because increasing revenues have improved the profits to earnings ratio.

Spain's companies should keep cleaning up their debt, but without denying themselves the mechanisms for growth. r others to follow, with its acquisitions, the telecom has increased its debt, but managed to deleverage, because increasing revenues have improved the profits to earnings ratio. Spain's companies should keep cleaning up their debt, but without denying themselves the mechanisms for growth.