The crisis triggered significant civil unrest. In addition to multiple strikes and demonstrations, the Indignados (15-M) movement arose in reaction to the failure of the political class to respond fully to the financial crisis.

15m Indignados Spain

Unlike the Greek and Portuguese cases, which resulted in part from excessive debt, the Spanish experience of the 2008 financial crisis was triggered by the property bubble at the heart of its post-Euro economic boom. Spanish banks borrowed internationally to finance the housing boom, and thus suffered when the global markets fell into disarray after 2008. The Spanish economy entered recession in the second half of 2008, but after creating a bailout fund (FROB), the economy bounced back temporarily in early 2010. Yet within six months, PM Jose-Luis Zapatero and his cabinet initiated an austerity programme, a labour market reform and a pension reform to address fears over Spain’s public deficit and the threat of further economic crisis. But these reforms, along with a constitutional amendment requiring balanced budgets, did not prevent popular anger over a 22% unemployment rate. (Indeed, by some calculations, adult unemployment reached 25%, and later, in 2015, youth unemployment hovered at 56%). In many local and regional elections, the conservative People’s Party (Partido Popular) was elected, and finally the incumbent Socialist Party was ousted from national office in November 2011, replaced by the People’s Party and led by Mariano Rajoy.

Indignados

PM Rajoy intensified the austerity measures in his first months in office. In May 2012, a major Spanish bank, Bankia, asked for a bailout, triggering the government to approach Eurozone finance ministers. The government accepted a 10 billion euro bailout from the European Financial Stability Facility and the European Stability Mechanism, and made plans to restructure the banking sector. The crisis also triggered significant civil unrest. In addition to multiple strikes and demonstrations, the Indignados (15-M) movement arose in reaction to the failure of the political class to respond fully to the financial crisis. National-level protest movements, including 15-M and the Waves (Mareas), have also spawned politically successfully platforms at the local and regional level such as ‘Barcelona En Comú’ and ‘Ahora Madrid’.

Key Dates:

  • July 2008: Recession begins
  • March 2009: Government rescues regional bank, Caja Castilla-La Mancha
  • May 2010: Austerity programme begins
  • 15 May 2011: Demonstrations by Indignados (15-M) begin
  • September 2011: Balanced budget constitutional amendment passed
  • April 2012: Wave of anti-austerity protests
  • May 2012: Bankia asks for 19 billion euro national bailout
  • June 2012: Spain agrees to bailout from Eurozone

Key Facts

Population: 48,146,134 (July 2015 est.)

  2005 2009 2015
GDP $1.019 trillion $1.379 trillion $1.615 trillion
Unemployment 9.2% 18.1% 22.5%
Public Debt (% of GDP) 42.9% 53.2% 99.2%
Key Dates
July 2008 Recession begins
March 2009 Government rescues regional bank, Caja Castilla-La Mancha
May 2010 Austerity programme begins
September 2011 Balanced budget constitutional amendment passed
April 2012 Wave of anti-austerity protests
May 2012 Bankia asks for 19 billion euro national bailout
June 2012 Spain agrees to bailout from Eurozone