Organization/Publication:    Capital

Author: Juan Llobell

Date:   4th April 2011

Re:      Interview with Mr. Kennet Rogoff

The economy magazine Capital, from DixiMedia Group, has published this week an interview with Mr. Kenneth Rogoff, the renown Havard Economy Professor who acted as Economic Counsellor and Director of the Research Department of the International Monetary Fund from August 2001 to September 2003; the reason of the interview is Mr.Rogoff best-seller about the last 800 years of recession (“This time is different” co-authored with Carmen Reinhart).

The author of the interview qualifies Mr. Rogoff as one of the most respected voices worldwide, along with Paul Krugman (professor of Economics and International Affairs at Princeton University) or Joseph Stiglitz (Nobel Memorial Prize in Economic Sciences (2001)).

Here I have translated an extract of the interview, where Mr. Rogoff provides his opinion about the current economic situation of the Spanish state (click here to read the original publication in Spanish: http://www.capital.es/2011/04/04/kenneth-rogoff-%E2%80%9Csi-espana-quiebra-podria-caer-hasta-francia%E2%80%9D/ .)

What do you think of the Spanish economy?
–I have no doubts that the biggest challenge for Spain is to grow. With  20% unemployment rate, the country will need a lot of good luck to increase its GDP this year. It is absolutely necessary they achieve at least 3 or 4% growth rate in order to reduce unemployment, but this is not very probable in the medium term. Furthermore, it is clear that Spain needs a deep structural reform of its whole economic system.

– Do you think Zapatero’s government has done everything possible?
–The current Spanish government has not been fast enough taking the right measures, though they are doing some things. In time, we will see the impact of these measures and how they are being put into practice. Direct short-term impact measures are urgently required, most specially in regards to unemployment. Yet Spain is a country with various fortress and cannot be compared to other states. There are some excellent multinationals here, and of course they administrate Catalonia, a nation that if independent would become one of the richest countries of the world… However, without growth, all these deficit restructuring plans will not be sustainable. In that case, I can foresee at least 5 year stagnation for the Spanish state.

I hope it is obvious for everyone that this is a new of absolute relevance for the Catalan people. One of the most important economist in the world believes that if Catalonia would obtain its own sovereignty, it would become a rich country. This boosts up our will for a total break-up with the Spanish government, supported by worldwide respected economists.

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