AP TELEVISION
1. Wide of of Roman Escolado from the Spanish government owned development bank ICO (Instituto de Credito Oficial) and Dr Ulrich Schroeder from the German government owned development bank KfW signing agreement
2. Wide of media
3. Wide of Escolado and Schroeder exchanging documents
4. Wide of news conference
5. German Finance Minister Wolfgang Schaeuble and Luis de Guindos (right)
6. SOUNDBITE (Spanish) Luis de Guindos, Spanish Finance Minister:
"I will underline again that this is not only a signing of a loan, but rather a joint action by the German and Spanish governments from the perspective of appropriate economic policy in the eurozone."
7. Cutaway of media
8. SOUNDBITE (German) Wolfgang Schaeuble, German Finance Minister:
"I believe it is a good day not only for our countries, but rather for our efforts in and for Europe"
9. Wide of news conference
10. Mid of photographer
11. SOUNDBITE (German) Philipp Roesler, German Economy Minister:
"This is on one hand is about 800 (m) million euros, but above all it is a signal of confidence on Germany's part in the successful reforms in Spain."
12. Wide of news conference
STORYLINE:
Germany and Spain on Thursday signed a deal under which Berlin will provide 800 (m) million euros (about 1 (b) billion US dollars) to ease a credit crunch for small and medium-sized Spanish companies.
The agreement will see Germany's state-owned KfW development bank loan the money to its Spanish counterpart, the Instituto de Credito Oficial (ICO).
That will expand the ICO's lending power.
The Spanish Finance Minister, Luis de Guindos, said Spain was receiving a 10-year loan at favourable conditions.
"I will underline again that this is not only a signing of a loan, but rather a joint action by the German and Spanish governments from the perspective of appropriate economic policy in the eurozone," he said.
The ICO will be able to provide several times the amount lent by Germany in cheap loans to smaller companies, de Guindos added, putting the total at some 2.4 (b) billion euros (3 (b) billion US dollars), since the Spanish bank generally loans money over a three-year period.
His German counterpart Wolfgang Schaeuble said the accord aimed to help small Spanish companies expand their workforces and train young people.
"I believe it is a good day not only for our countries, but rather for our efforts in and for Europe," said Schaeuble.
The European Central Bank's benchmark interest rate is currently at a record low 0.5 per cent, but banks in much of southern Europe aren't passing that rate on to companies because their own finances are strained.
Spain has been in recession for most of the past four years following the collapse of its credit-fuelled real estate sector in 2008.
The government has predicted the economy will contract by 1.3 per cent overall in 2013.
Despite a 27.2 per cent unemployment rate – one of the European Union's highest – and a still bloated deficit, the government said its reforms and austerity measures were paying off and recovery was in sight.
Germany said Thursday's agreement was a sign of support.
"This is on one hand about 800 (m) million euros, but above all it is a signal of confidence on Germany's part in the successful reforms in Spain," German Economy Minister Philipp Roesler said.
You can license this story through AP Archive:
Find out more about AP Archive:
