Madrid - Spanish Prime Minister Jose Luis Rodriguez Zapatero on Wednesday described the country as being on a slow road to recovery from its worst economic crisis in six decades, while the opposition accused him of misleading citizens about the seriousness of the situation. The worst of the crisis was over, Zapatero said during the first major parliamentary debate after the summer holidays.
However, it will take "considerable time" for the economy to recover, even if it picks up sooner than expected, he admitted.
The government expects the economy to shrink 3.6 per cent this year, while unemployment is running at 18 per cent, the highest by far in the European Union.
The government was planning a "moderate" tax hike to guarantee social security benefits and economic stimulus measures during the crisis, Zapatero said.
The tax hikes would remain below 1.5 per cent of gross domestic product (GDP), the premier explained, describing that level as being well below the European average.
Conservative opposition leader Mariano Rajoy said tax hikes would further paralyze the economy by reducing consumption, and accused the socialist government of having gone on a spending spree for which no taxes could make up.
The government had taken "disorderly" measures to fight the crisis, creating a "huge" public deficit, Rajoy charged.
Measures such as increasing funding for public works have contributed to increasing the public deficit, which is expected to reach up to 10 per cent of GDP in 2009.
Rajoy's People's Party (PP) has launched a publicity campaign against the tax hikes, accusing the government of making the middle class "pay for the mistakes of Zapatero," whose government has come under widespread criticism for its handling of the crisis.
