Strong public finances Robust economic growth Membership of the European Economic and Monetary Union (EMU) High and rising level of private sector indebtedness Economic growth prospects weakened by relative deterioration in export competitiveness Unbalanced, labor-intensive growth resulting in low productivity increases The ratings reflect the Kingdom of Spain's strong fiscal position, which has been supported by expenditure control, declining interest payments, and healthy revenues. Although the general government has recorded small deficits in recent years, we expect modest surpluses in the medium term thanks to buoyant revenue growth at the central government level, social security surpluses, and the largely balanced position of Spanish local and regional governments. Moreover, the debt-to-GDP ratio is likely to continue its downward trend toward 30%,
