8:38 AM » Spain reform plan to be outlined next week: FT
MADRID (MarketWatch) -- Spain could be poised to announce an economic reform plan next week, the Financial Times reported Friday. Citing officials involved in the talks, the FT said European Union authorities are working with the Spanish government to come up with a plan to pave the way for a new rescue plan and unlimited bond buying by the European Central Bank. Those officials said talks between Spain and the EU are focusing on conditions demanded by international lenders as part of a new rescue plan, which would need to be in place before any rescue plan was announced. One senior European official said negotiations have been taking place with Spanish Finance Minister Luis de Guindos, and talks are surrounding structural reforms to the economy, but not new taxes or cuts. Next Friday, the Spanish government is expected to announce results of a review of its banking system, which will also include how much the European Stability Mechanism needs to recapitalize those banks. A media report the prior day said Spain was looking into a way of using some of the 100 billion euros ($130 billion) that has been earmarked for a bailout of its banking system for a bigger sovereign bailout. Simon O'Connor, the European Commission's economic spokesman told the FT that Spain could not redirect aid money.