A car bomb has exploded in the seaside town of Gatxo near Bilbao in northern Spain on Tuesday afternoon, injuring a police officer and dashing hopes of an ETA ceasefire.The blast occurred shortly after the Basque newspaper Gara received a phone call from a person claiming to represent the Basque separatist group. The car had been left near the home of a high-profile Basque businessman.Expectations had been raised in Spain over the last few days that ETA might be close to declaring a ceasefire. Spain’s Socialist government rules out talks with ETA unless it renounces violence and ends its bombing and shooting campaign. ETA seemed to be heading towards that direction with a statement on Sunday. It said it backed negotiations with Madrid but in the statement there was no mention it would lay down its weapons. The car bomb on Tuesday afternoon exploded soon after a statement by Arnaldo Ortegi, leader of ETA’s banned political wing. Speaking in San Sebastian, he said there is currently no negotiation process. “This country is still in conflict,” he said. “We are still trying to resolve things in another way.” Events took place just five days after the head of the Basque Country regional government put forward a proposal on Basque sovereignty, which Madrid has rejected.