Spain’s €15bn austerity plan is flawed, warns leading economist

Javier Diaz-Gimenez, IESE Business School, Madrid

Spain’s €15 billion austerity package, announced on May 12, may fail to alleviate the fiscal deficit because the government has “overestimated” growth rates and tax revenues, a leading Spanish economist has warned.

“The Spanish government forecast for growth, which is double the figure estimated by the IMF or EU, is very optimistic,” says Javier Diaz-Gimenez, professor of economics at IESE Business School in Madrid. “When you get that kind of forecast – and if you’re going to use that to design