Washington, Oct 13 (AFP) The International Monetary Fundwarned today that Spain's strong economic recovery could bedealt a setback if the political turmoil over Catalonia'sindependence push continues.
IMF Europe Director Poul Thomsen said he would notaddress the issues behind the battle between Madrid and theCatalan region, which accounts for one-fifth of the country'seconomy.
However, he said, "If there was prolonged uncertainty,that could weigh on growth, and obviously we want to avoidthat."The IMF, whose guidance and aid helped Spain reboundfaster than other European countries from the economic crisisthat erupted in 2009, has avoided comment on the key issuesbehind Catalonia's push to break with Spain.
Speaking during the IMF-World Bank annual meetings inWashington this week, Thomsen stressed that Spain has donebetter at implementing economic reforms than other Europeancountries.
"Spain has had a very robust recovery," he said, callingit "a showcase of the effectiveness of reforms, not leastlabor market reforms."But worries about the impact of Catalonia's referendumvote for independence were clear during the IMF-World Bankmeetings.
On Tuesday Maurice Obstfeld, the IMF's top economist,expressed concern over the Catalan move.
"The situation in Spain is, indeed, concerning as itcauses a lot of uncertainty both for the Catalan economy andfor the Spanish economy," he said Tuesday.
He warned of potential "spillovers" to other countries inEurope.
"We can only hope that the parties do not actprecipitously [and] negotiate."Earlier today, Spain warned it could lower its forecastfor next year's economic growth if Catalonia's separatistchallenge persists. (AFP)RB.
This is unedited, unformatted feed from the Press Trust of India wire.