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Support for Spanish economy from China

Support for Spanish economy from China
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China’s Vice Premier Li Keqiang on a visit to Madrid has told Prime Minister José Luis Rodríguez Zapatero that Beijing will continue to buy Spanish government bonds to support Spain in combating the euro zone’s sovereign debt crisis.

He gave the same assurance to Finance Minister Elena Salgado in the latest signs of China’s willingness to shore up European finances.

Across the border, Portugal has just borrowed 500 million euros through treasury bills which are due to mature in six months time, but to get investors to buy them Lisbon had to offer four times more than in a previous auction of similar T-bills last March.

Analysts said they were relieved it did not have to offer an even higher yield.

The region’s weaker economies continue to affect growth.

The latest figures for the euro zone services sector show a slowdown in overall growth in December.

The Purchasing Managers’ Index – which measures the activities of thousands of businesses ranging from banks to restaurants – demonstrated a two-speed regional recovery with declines in Ireland and Spain, Italy was stagnant and Germany and France expanded.