Wealthy, relatively diversified economy with stable political system Accelerated pace of structural reform and restoration of public finance discipline Fiscal flexibility underpinned by moderate, albeit rising, general government debt Weak economic growth prospects due to ongoing private-sector deleveraging and relative deterioration in export competitiveness High unemployment and labor market rigidities, which we expect will be addressed via ongoing reforms Significant net external debt level, implying private sector vulnerability to a deterioration in external financing conditions The ratings on Spain reflect the benefits of what we view as a modern and relatively diversified economy, as well as our opinion of the government's continuing political resolve to deal with the outstanding challenges, as reflected in a significant acceleration in both budgetary consolidation
