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The country with over twenty-five percent of its population unemployed has finally climbed out of recession with third quarter growth up 0.1 percent. With an economy that is driven mainly by the tourism sector, automobile industry, and the energy industry, Spain has managed to slow down its rate of poverty and unemployment enough to stop the recession. The bailed out banking sector is still far from cured and the giant amount of debt will still hold them back in the years to come, but the government has taken steps in the right direction in gaining control of these areas of the economy.
Using spending cuts and government assistance along with the growth of exports, competition and investor confidence, Spain has been able to take itself off the still lengthy list of European countries with economies in recession. Still left on the list are Cyprus, Estonia, Greece, Italy, the Netherlands and Slovenia. The global financial crisis has hit these countries harder than most, yet Europe has still been able to exit its recession as a whole due to the large growth in countries like Germany and France.
Some countries are still a long way from escaping the wrath of the financial crisis. Greece has delved deeper into its recession recently as the economy contracted 4.6 percent in the most recent quarter, hit an unemployment percentage of 27.6 percent, and bankruptcies have increased for businesses by a large amount. It is currently awaiting approval for bailouts from the European Union and International Monetary Fund. Political instability in Italy has made it so no reforms to help grow the economy will be able to pass due to weak government support. Spending cuts have been introduced in order to try to take control of the massive public debt it has developed.
Cyprus has entered a downward spiral after their banks collapsed and required a bailout. Investment has been stunted due to low consumer confidence and the poor outlook for the future. As for Europe as a whole, it is up to other countries besides France and Germany to step up and create the growth that the European Union is looking for. How do you think these countries will be able to escape recession?
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