Awash in debt and 20 percent unemployment, the Spanish government on Friday approved an austerity package aimed at reviving its moribund economy.

While the news gave markets a lift, labor unions are howling and threatening a series of strikes. –JCL

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The moves include plans to sell off a 30 per cent stake in the government-owned national lottery, the partial privatization of airports, cutbacks to a key jobless benefit, tax cuts for small businesses and an increase in the tobacco tax.

“We believe we are contributing to the momentum of the country’s economic activity with this reform package,” said Economy Minister Elena Salgado. “We are eliminating obstacles and reducing costs.”

The latest measures, first announced Wednesday by Zapatero, were welcomed by both markets and the European Union after weeks of speculation that Portugal and Spain could follow Greece and Ireland in needing a massive financial bailout. ing to convince markets it can handle its debt and won’t need a bailout from the European Union and International Monetary Fund like Ireland and Greece.

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