Speech by President of the Government at presentation of book by Minister for Economic Affairs and Competition

Madam President of the Rafael del Pino Foundation, Madam Vice-President of the Government, Cabinet Members, Chairman of the Planeta Group, my friend Luis, ladies and gentlemen,

A very good afternoon to you all and thank you very much for attending.

For me it is an honour to be here for many reasons, only two of which I will mention in this opening part of my speech.

I knew the elder Rafael del Pino. He was a brilliant figure, like few others I have known in my lifetime, and hence, it is a pleasure to be here at this foundation that takes his name. And I would also take the opportunity - my second opening comment - to congratulate you on the work this foundation is doing. If only many more people were in a position and had sufficient interest, courage and determination to do similar things. If that were the case, things would undoubtedly be much better for us.

For me it is an honour to take part in the presentation of the book by the Minister for Economic Affairs, Luis de Guindos, a close collaborator of mine over these years which, believe me, have been tough, and also a key figure in my government's economic team.

This book, that deals with many things and which, as you would expect, pays special attention to those events that the author lived through first-hand, and hence, as is only natural, with great intensity. I will speak about that later, about personal experiences; what I would like to remark on at this time is that the ultimate goal of Luis de Guindos is to explain and outline to the reader, as he said in his speech, the path we had to take during those years - particularly in 2012 - in order to redirect the economic situation of Spain; a path which, as the reader will see, was neither easy nor smooth. I must say that were we unable to count on a great deal of aid, or even widespread comprehension, either in Spain or further afield.

As the author clearly reminds us in certain passages of the book, during that year, 2012, "going from meeting to meeting - Luis- like an offender, receiving warnings". When I read that expression, I was reminded of that infamous meeting of the G-20 in Mexico, in Los Cabos, in Baja California, which is also mentioned in the book, where, in a heated environment and in the financial spotlight it could be seen, textually, that "Spain was the centre of all the concerns and we were the main risk to the euro".

What life brings us when, just two years on, at another meeting of the G-20, this time in Australia, Spain returned to the spotlight, but for very different reasons: we were tasked with presenting a speech, which I did, on the success of the economic reforms for growth.

That is why, in terms of the differences in two appearances at the same event only two years apart, this is a story that warrants telling and, moreover, it allows us to see what we shouldn't do in the future.

In line with what I have said, we are looking at a book that is a "must read" for all those of us who have a true interest in expanding our knowledge of what has happened to the Spanish economy over recent years, before, during and after 2012. This is a book that will undoubtedly capture the attention of those who wish to go beyond mere anecdotes, rumour-mongering and minor issues which are so in vogue, as you well know, in the times in which we find ourselves.

This is a "must read" book, firstly, because of the figure of the author: the author is the Minister for Economic Affairs and Competition; consequently, he is well informed and speaks with the certainty of someone who has played a leading role in this story. You all know that speaking when you are well informed is something highly recommendable; it is a good custom that we should not allow to fall into disuse. It is good to speak knowing what you are talking about and it is good to listen to those who know what they are talking about.

But this is also a "must read" book because of the rigour, depth and, if you will allow me, the objectivity with which it tackles important questions. And this, which may seem like a mere platitude, is not so. In the economy, in politics and in life in general, banal issues may be tackled, if you like, with frivolity and lightly, and it doesn't matter. But important matters require to be treated and handled as such, and the Spanish economy, the economy of the Spanish people, is an extremely serious issue.

Ladies and gentlemen,

You know what state the Spanish economy was in at the end of 2011, when we took on the responsibility for governing Spain. Consequently, I will spare you the details, although I would just remind you of a few facts:

• Spain was, as we were reminded by the minister in his speech, in recession. Economic activity in the fourth quarter of 2011 had fallen by 1.8%.

• Unemployment, according to the public employment services, had been rising steadily since June 2007. In turn, the number of National Insurance contributors had constantly and consistently suffered many straight months of decline since June 2008. In other words, three and a half years, more than 40 straight months in a row, of systematic shedding of jobs. During this period, the Social Security system lost 2.1 million contributors.

• The figures on inflation, the balance of payments and the public deficit were all, quite simply, unsustainable.

• The competitiveness of the Spanish economy was in clear decline.

• The situation of a good part of our financial system, as the minister mentioned to us in his speech, was on the verge of bankruptcy.

And worse still, the future expectations and the general unease of the economic and social agents, and of the Spanish people as a whole, were, quite simply, at an all-time low. There was no hope, no horizon, and no future, just a constant and heartbreaking litany of dreadful economic news.

Moreover, beyond our borders, Spain was perceived as one of the main risks to the European economic panorama and a threat to the global economy.

Those readers who delve into the pages of this book will find plenty of references to the far-reaching and intense negotiations we held with the European institutions over the course of this long period. Worthy of special mention are the complex and arduous negotiations to achieve European financial assistance that allowed us to clean up our financial system, negotiations that concluded on 9 June 2012. As the author confesses, that was most important day he had as the Minister for Economic Affairs and let me assure you that there were plenty of important days - those are my words, not the authors - back then.

Such was the situation that many considered that Spain only had two options available to it: to leave the euro or to ask Europe for the Spanish economy to be bailed out. However, we all opted for a third option, which, it should be pointed out, almost no-one believed possible, which was to undertake the structural reforms necessary to correct the imbalances of our economy and thus recover the lost competitiveness and rediscover the path towards growth and job creation.

In all honesty, and I say this how I see it, I think that the raft of reforms adopted by this government is the most important in the recent history of Spain. When you read this book, you will have the chance to see how a good part of these arose, the goals behind them, how they were defined and what difficulties they faced before seeing the light of day.

This book also contains a detailed annex of what was directly proposed by the Ministry of Economic Affairs. You will find, for example, all of the measures to clean up the financial sector, which was an arduous and complex task, misunderstood by many, others didn't understand them but criticised them anyway because that was their job; but the process of cleaning up the financial sector was, quite clearly, one of the most important operations undertaken in our country in recent years, together with protecting minority shareholders, the Code of Good Practices to quell the drama of evictions, the Market Unity Act, the Law to Boost Entrepreneurial Activity, and so on and so forth.

In addition, there were many other measures pushed through by other ministerial departments. Allow me to remind you of the importance of the Budget Stability Act, which guaranteed fiscal discipline at all levels of the public administration; the reform of the public administration service which not only led to major savings but also to great strides being taken in streamlining the public sector; the labour reform, which made the labour market more flexible as well as more buoyant; the energy reform, which was very difficult as there was an accumulated tariff deficit when we came to power of more than 20 billion euros, etc.

I won't bore you, I just want to point out that work well done and, fundamentally, the efforts and the responsibility of the Spanish people, have borne fruit and I feel very proud of having headed up this government and of all the members of my government who, in the same way as the Minister for Economic Affairs, got fully involved in the definition of these reforms, their implementation and their subsequent execution.

Ladies and gentlemen,

We can now say that, in general, the imbalances of the Spanish economy are either now behind us or are at least on the path to being resolved, although there is still a lot of work to do. The competitiveness of our economy has improved a great deal vis-à-vis our peer countries and what is more important, we are now in our third straight year of growth. Out of the major economies in the European Union, Spain has increased its GDP the most: 3.2% year-on-year in the latest figures published, compared with 1.6% in the Eurozone. If we look at the figures for the second quarter, Spain grew by 0.8% compared with 0.3% in the Eurozone or zero in France and Italy. Who would have wagered on that back in 2012?

More importantly, and something which is more pleasing for any member of government is that the job creation rate has started to speed up. National Insurance contributors are rising at a rate of 519,000 new contributors per year and unemployment, according to the public employment services, is falling at an annual rate of 9.1%. When we came to power, unemployment was growing at an annual rate of 10%. I believe that these two figures explain the change that has very clearly taken place in the Spanish economy in recent years.

So, ladies and gentlemen, that is, in short, the great transformation of the Spanish economy, which justifies all these reforms and all these difficulties, and that is the tale that is told in the book by Luis de Guindos.

I would like to say to you, for my part, that, if we continue with these policies and if we continue to make progress on the structural reforms that our country needs, Spain can grow at a fast rate in the coming years, around 2.5% annually, and even higher if the conditions are right. This would allow around half a million new jobs to be created each year, as happened in 2014 and 2015. Hence, we would be able to consolidate the implementation of a healthy and lasting model of growth based on competitiveness, which would enable us to be in a better position to resolve the difficulties that may emerge on the international stage, difficulties which, as you know, are bound to emerge.

But all of this, and this is important, may change if we do not continue to work or if we turn back up the path we have gone down, which is what some people are proposing. If you don't have a government that is taking steps and extending the structural reforms, then you cannot consolidate growth. I would remind you what one of the rating agencies said not long ago: "The economic and fiscal costs deriving from the current vacuum in the leadership are rising and we expect both a weakening of economic growth and worse fiscal performance the closer we get to 2017". What this rating agency said is subscribed to by many economic agents and I fear that it is not far from what common sense dictates.

Ladies and gentlemen,

Despite the frivolities of some people, being without a fully operative government is something bad, it is counter-productive, as well as beyond the realms of democratic logic and it is clearly very harmful to economic confidence. And this harms Spain a great deal. If this harm has not yet hit us, it is because the government was prudent and foresaw this outcome, and we left the Budget for this year, for 2016, approved. It is true that those who so strongly criticise us now choose to forget this matter and devote themselves to seeking other arguments to bang on about, on the sidelines of or in direct contradiction to what common sense, responsibility and the general interest all dictate.

Ladies and gentlemen,

This present political stalemate will harm our economy and hence, it will be harmful to the Spanish people. In fact, as we were reminded by the minister in his speech, we are starting to see signs that should concern us. And on this matter we should not be fooled: if our economic policy does not generate confidence, it will be impossible to maintain the current rate of growth and job creation. To put it another way, the lack of a government has a clear cost and each day that passes this becomes clearer and higher.

And moreover, the situation will also change if what we end up having is a bad government that seeks to overturn the policies implemented to date which have laid the foundations for a balanced and sound economic model. If these policies are done away with, the same thing will happen as always happens, because we also have experience of this. When we have not given due care to economic policy or when the government has acted demagogically or irresponsibly, imbalances have accumulated and a cycle of loss of competitiveness has initiated which, in the end, has always led to jobs being shed.

Ladies and gentlemen,

Before closing, allow me not only to speak to you about the economics, but also about politics, which may also be of interest to you and is also important.

This book speaks a great deal about economics, about economic reforms and all those issues we have just mentioned, but above all, it talks about POLITICS, in capital letters. I appreciate that Luis de Guindos has sought to set out his experience, which in this case is not just that of a brilliant economist, or of a theorist; this is the experience of a politician, of a man of action who, in an adverse situation and under tremendous pressure, because that's how it was, sought solutions guided by only one overriding interest: doing what was best for his country.

This is not a book written by an academic, which it could also be, nor is it a book by an observer of the reality; this is a book by a man who is passionate about serving his country and you can see that from the first page to the last. The reader can clearly perceive the suffering, the anguish and the angst we went through in those faraway days back in 2012 because, although some do not believe this, politicians are also people and we have feelings just like anyone else.

So, I believe that Luis de Guindos has shared this passion with each and every member of my government, and that is why I believe that we can all feel represented in his tale of the fight we fought tooth and nail back in 2012. He has told the story which, in one way or another, we all went through.

I can tell you that we always agreed on the key issues: we believed in Spain and we trusted blindly in the ability of our compatriots to overcome this situation. "Spain is a great country" and, as the author tells us, that was our motto, our flag, our beacon in the darkness, the straw we grasped at when everything seemed doomed and our guiding star in the greatest moments of difficulty.

Spain showed itself to be a great country, something we already knew, and today we all have the personal satisfaction of having collaborated, each one with his or her own responsibility, which are many and varied, in proving this phrase once again to be true.

That for me, and nothing else, is the true meaning of politics; that for me, and nothing else, is the heritage we will take away from this period of our lives. Have we made mistakes? Undoubtedly. There are some lucky people who never make a mistake. We do, and we will continue to make them in the future because we are not perfect, but what can we do? But, I am absolutely certain that we have got the basic things right. We have the facts before us to support that and we have the trust that the Spanish people have placed in us.

Ladies and gentlemen,

We should not forget this because that is the underlying reason for our activity: we implement policies to change things and to resolve problems, or, at least, to try to do so.

I repeat, we should not confuse the means and the ends. The ultimate goal of politics is not to arouse controversy but to manage. Controversy, contrasting views, contrasting ideas and debates are a means, one more to perhaps try to govern and transform the reality, to try to improve people's lives. That is why we debate, undertake electoral campaigns, challenge each other in Parliament, and for the greater good, we overcome our differences when this is required in the interest of the Spanish people.

In politics, confrontation, discussion and even show, which is what now prevails, has its place, as it must do, but this cannot be the ultimate goal. Not everything can be an obstinate and sterile confrontation that leaves no room for any other consideration. We must distinguish between when we should engage and when we should cooperate. Debating for the sake of debating in a spiral of words without offering results to people is not politics, it is something else. You choose the word you feel best suits.

Politics is talked about a great deal at this time in all forums: in the social networks, on the radio, on television, in all sorts of chats, by all sorts of people, at all times of day and night. Politics is talked about but these words are not being put into practice because if Spain were practicing politics now, we would have had a government and an opposition for some time now. Instead what we have is what is called a caretaker government - don't think that it is easy to operate in such a situation as this - and we clearly have no opposition; we only have a lot of noise and a stalemate.

Societies cannot live in a permanent election campaign, in the same way as no-one can live in a permanent adolescence. Campaigns last for a fortnight and end on the day on which the votes are counted. At that moment, the disputes must end or, at least, be rationalised - those who win start to govern and those who lose operate to control the government and adjust their proposals in such a way that they can receive more support in the next election campaign.

That is what normally happens everywhere, but that is not what has happened in Spain. As you know, the votes have been counted twice but the Spanish people are still awaiting their government.

Spain cannot continue with this stalemate due to the stubbornness of those who don't want to admit defeat. Mr Sánchez, for some inexplicable reason, appears to be resolute in his intention to take us all to another general election which no-one will benefit from. A third round of elections would only serve to discredit our policies and lead people to mistrust Spain.

I will finish now.

I believe that as every day passes this policy of results and good management becomes more necessary and more pressing. For me, the extremism that Spain needs at this time is one of common sense and, of course, there are some, all of us who are here, who are prepared to do battle for as long as the Spanish people want us to. It is time to shut up and, as Ortega said, get to work on what really matters: the economy, employment, security and the future.

Ladies and gentlemen,

I will say things how I see them; this book is a good opportunity to once again find those things that really matter, things we were on the verge of losing, which took a great deal of effort to recover and which we cannot allow to turn sour before our very eyes once again.

Thank you very much and congratulations.