Spain economy shrinks for 7th consecutive quarter

Spain’s economy has contracted for the seventh consecutive quarter as the eurozone’s fourth largest economy fell deeper into recession.

Spain’s National Statistics Institute said on Thursday that the country’s gross domestic product (GDP) shrank by 0.5 percent in the first three months of 2013.

The fall has been mainly blamed on a decrease in internal demand.

The seventh consecutive quarter of contraction in the Spanish economy shows the extent of the country’s struggle to recover from 2008 property market crash that affected millions of jobs and increased the national debt.

The institute also said that Spain’s GDP had also dipped by 0.8 percent in the previous quarter.

The government of Prime Minister Mariano Rajoy predicts a 1.3-percent economic decline this year and the Bank of Spain said earlier this week that the recession will extend into the second quarter of the current year.

The jobless rate in the country has reached a record high of 27 percent. The official figures show that the total number of unemployed people has passed the six million mark, reaching 6.2 million.

Spain is in the grip of a double dip recession, which has driven its unemployment rate to 55 percent among those aged 16 to 24.

Battered by the global financial downturn, the Spanish economy collapsed into recession in the second half of 2008, taking millions of jobs with it.

Spain must lower its deficit to 4.5 percent in 2013 and 2.8 percent in 2014. Many economists, however, say those targets will be difficult to meet amid poor prospects for Spain’s economic recovery.

The Spanish government has also been sharply criticized over its austerity measures that are hitting the middle and working classes the hardest.