By Jesús Aguado and Emma Pinedo

MADRID (Reuters) – Bank of Spain governor Pablo Hernandez de Cos on Tuesday warned

that potential harsher measures to contain the recent wave of COVID-19 contagion in the country may lead to an even deeper crisis than the bank’s worst-case scenario.

Spain, one of the worst-affected nations with more than 32,000 deaths and more than 800,000 cases, is heading for its worst economic performance on record in 2020, with an expected contraction of 10.5% or 12.6%, according to the Bank of Spain.

De Cos warned that underlying risks remain tilted downwards.

“We cannot rule out more unfavourable developments than the ones we had in our second scenario, the more adverse of the two we considered,” he said.

In this context, De Cos also urged broad political and social consensus to cope with the economic fallout from the COVID-19 disease as a political spat over how to tackle the crisis is escalating.

The national and regional governments have traded barbs over what to do and who was to blame for an increase in cases in Madrid and its periphery, taking to new heights the political polarisation that has characterised much of the response to the pandemic over the past months.

“We must be aware of the magnitude of the challenge we face (…) and therefore I urge that we reach broad political and social agreements to tackle the urgent, ambitious and comprehensive growth strategy that our country needs,” De Cos told parliament.

Spain’s central bank governor also urged politicians to carry out structural reforms on the Spanish labour market to improve productivity, while maintaining some fiscal stimulus in the short-term to weather the crisis.

De Cos, who also sits on the governing council of the European Central Bank (ECB), also said that there was scope

(Bloomberg) —


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Spain is stepping up its efforts to enter the race to build a hydrogen industry, putting it on par with France and Germany in seeking a greener fuel for heavy industry.

The government in Madrid has a roadmap to build 4 gigawatts of green hydrogen capacity by 2030 and is expected to announce Cabinet approval of the program on Tuesday, according to Sara Aagesen, the secretary of state of energy. The program would require an investment of 8.9 billion euros ($10.5 billion) within the next decade. 

“Things are getting very competitive,” Aagesen said in an interview on Monday. “Spain has the capacity to become a relevant player in the renewable hydrogen sector by taking advantage of our high potential of generating renewable power at very competitive prices.” 

The European Union has put hydrogen at the heart of its measures to cut greenhouse gas emissions by at least 55% in 2030 and to become climate neutral by 2050. Hydrogen, if it’s made with renewables, could replace oil, natural gas and coal and help eliminate about a third of emissions from industries like steel and cement by mid-century, according to BloombergNEF. The processes to make green hydrogen aren’t yet economically viable without government support. 

Spain’s plan includes 60 measures that will help establish a hydrogen supply chain, according to a government document seen by Bloomberg. The roadmap targets manufacturing plants with a capacity to make 300 to 600 megawatts of hydrogen from renewables by 2024 and 4 gigawatts by 2030. That would represent 10% of the EU’s target, which is for 40 gigawatts by 2030. Spain plans to start measuring hydrogen production by energy source and to review targets at least every three years. 

graphical user interface: Hydrogen Dreams

© Bloomberg
Hydrogen Dreams

The government has not yet established how much of the

Former IMF chief Rodrigo Rato and all other defendants put on trial on accusations of fraud and falsifying the books in the 2011 stock listing of Spain’s Bankia bank were acquitted on Tuesday.

The court said bank’s stock listing had received approvals “from all necessary institutions”.

The listing was very popular among small investors, who lost their shirts when the Spanish state had to nationalise the bank the following year and inject 22 billion euros ($25.7 billion) to keep it from collapsing.

Rato, who headed the International Monetary Fund from 2004 to 2007, led the merger in 2010 of several struggling banks into Bankia.

The image of a smiling Rato ringing the bell and sipping champagne on July 20, 2011 to mark the start of Bankia’s listing has since become a symbol of the scandal.

Former IMF head Rodrigo Rato, who was acquitted over fraud charges related to the 2011 listing of Bankia bank, had always maintained that the authorities were fully aware of what happened at the bank
(L) smiles as he leaves his office.Former IMF chief R Former IMF head Rodrigo Rato, who was acquitted over fraud charges related to the 2011 listing of Bankia bank, had always maintained that the authorities were fully aware of what happened at the bank
(L) smiles as he leaves his office.Former IMF chief Rodrigo Rato was acquitted in Spain bank trial on September 29, 2020.
Photo: AFP / Pierre-Philippe MARCOU

More than 300,000 small shareholders bought share packages for a minimum of 1,000 euros, attracted by a major advertising campaign and the profits boasted by the bank.

But in 2012, after a disastrous year that saw its share value collapse, the bank admitted that in the year it listed it had actually made a loss of close to three billion euros.

In addition to bailing out Bankia the Spanish state also had to seek an EU rescue plan for the nation’s entire banking sector as investor confidence had been shaken.

During his trial Rato said Spain’s central bank was fully aware of everything that went