After denying yesterday that Spain needs a bailout during his appearance before Congress, Minister of Finance Luis de Guindos went to Germany today to meet with his German counterpart, the all-powerful Wolfgang Schäuble.
The meeting will decide the immediate future of our country, which is dealing with major liquidity problems because financing is scarce to nonexistent. Besides pointing to Spain's increased troubles getting financing, some experts say that De Guindos might try to negotiate the particulars of a bailout during his meeting, whether the bailout is partial or full.
Bearing in mind that the ECB has washed its hands of the issue -- Mario Draghi said in an interview published by Le Monde last Saturday, "We don't want to solve problems for individual member states" -- the most feasible solution is to take special measures using the temporary recovery fund known as the European Financial Stability Facility (EFSF), although this approach would require a unanimous vote and backing from countries such as the Netherlands and Finland, which are the most critical nations in the euro zone.
And Germany? The general feeling there is that they have done all they can to help and bail out struggling countries, compromising 28% of their GDP with beneficent loans, 50% of which went to help Spain.
Now that we have arrived at this point, it remains to be seen what the bailout conditions will look like and what special conditions will be placed on regional governments. Their spending has not been reigned in despite the Ministry of Finance's numerous attempts to do so.
