The national debt keeps growing thanks to high debt costs, which by the end of the first two quarters has risen to 11.845 billion euros. This level is expected to rise further because of high interest rates that the Treasury paid for its debt issues. Reducing the cost of servicing this debt is the government's central goal, and to do that it has to levy more cutbacks in health and education. The ECB and Germany require these steps before they agree to provide funding to Spain via the European recovery fund. If Spain can meet their objectives and get this funding, the risk premium should fall.
The national government requires the regions to not only meet but exceed their spending cutbacks and financial agreements, and it should heed its own advice in order to clear up any doubts about whether or not Spain can meet its obligations.
