Spain 'absolutely not' at risk of bailout

Spain 'absolutely not' at risk of bailout

Governing party's finance minister assures Spain is not headed for debt bailout as country prepares for elections.

Spain has insisted it is not at risk of an international debt bailout as borrowing costs shot to record highs, raising the stakes three days before a general election.

Markets put pressure on Spain by jacking up rates on its government bonds to euro-era records, near the levels that prompted Greece, Ireland and Portugal to seek help from the EU and International Monetary Fund.

"Spain nears the bailout zone," read an online headline on the left-leaning daily El Pais on Thursday, reflecting analysts' warnings.

The sharp spike in borrowing costs raised pressure on the man expected to win Sunday's election, conservative opposition leader Mariano Rajoy, and forced the outgoing government to try to calm the jitters.

"It is true that the markets are nervous but the sustainability of our debt is beyond all doubt," Finance Minister Elena Salgado told Cadena Ser radio.

Asked whether the rising borrowing costs indicated it was at risk of needing a bailout, Salgado said: "No, at risk of a bailout, absolutely not."

Spain's sovereign borrowing costs rose on Thursday to the highest levels since the introduction of the euro.
Its debt risk premium, a key measure of financial market confidence in a country, hit a euro-era record of 4.99 percentage points.

In a bond sale, the Treasury had to pay a rate of 6.975 per cent on its 10-year bonds - near the 7.0 per cent level that is broadly considered unsustainable.

Landslide expected

Greece, Ireland and Portugal quickly sought international aid once their bond yields rose that far and similar debt pressures has forced a change of government in Italy.

Spanish government 10-year bonds traded on the secondary market as high as 6.78 per cent - the highest since May 1997 when Spain was still using the peseta.

Salgado defended Spain against what she said were "systemic attacks on our sovereign debt and that of many countries" by the financial markets.

"We would like to pay lower rates because the fundamentals of the Spanish economy indicate that we deserve to," she said.

Polls show the conservative opposition People's Party is likely to win Sunday's election by a landslide, with voters expected to punish the governing Socialists.

Under Socialist rule, unemployment has soared to 21.5 per cent, the highest in the industrialised world, and analysts warn of a return to recession next year.

Analysts said the new government will have to act quickly to reassure investors that it can keep financing itself and bring down its budget deficit.

"Although Spain is in a rather better position than its southern European counterparts, the next government still faces huge challenges and is unlikely to overcome them without outside help," Capital Economics analyst Ben May said.

2. Man charged with Obama assassination attempt

Oscar Ortega-Hernandez charged with attempting to kill US president after shots fired at White House last week.

An Idaho man accused of firing two shots at the White House last week has been charged with attempting to assassinate US President Barack Obama or his staff.

Police arrested Oscar Ortega-Hernandez of Idaho Falls, Idaho, on Wednesday at a hotel in Pennsylvania, about four hours driving time from Washington, the US secret service said.

Ortega-Hernandez will be taken back from a federal court in Pittsburgh to face the charges in Washington.

He will remain in federal custody at least until a magistrate in the capital can determine if he should remain jailed until his trial on the charge, which carries up to life in prison.

The 21-year-old said only, "Yes, ma'am" when he was asked if he understood that he would be going back to Washington to face the charges.

Ortega-Hernandez was believed to be connected to last Friday's shooting after items found in an abandoned vehicle near the scene allegedly linked him to the incident, said sergeant David Schlosser, US park police spokesman.

The secret service said it discovered the bullet holes on Tuesday and that the bullet that hit the window was stopped by ballistic glass.

The location of the second bullet was not disclosed by the secret service, that stated only that the bullet "was found on the exterior of the White House".

Shots fired

Secret service agents heard shots fired on the street, south of the president's residence, on Friday.

Previously, authorities had said the White House did not appear to have been targeted.

Two cars were seen racing away from that scene. One of those vehicles was later found abandoned nearby with a
semi-automatic rifle on board.

Police also found an abandoned car Friday night near the Theodore Roosevelt Bridge that crosses the Potomac River to Virginia.

Ortega-Hernandezhad been reported missing on October 31 by his family.

He was stopped on Friday by police in Arlington, Virginia, after a citizen called in a report of somebody "circling the area", said Lieutenant Joe Kantor of the Arlington police department.

3. International pressure mounts on Syria

Arab and European countries circulate UN resolution condemning rights violations, as many more killed in violence.

Russia's FM Lavrov has described the violence in Syria as "quite similar to a true civil war" [Reuters]

Diplomatic pressure on the Syrian government has escalated as a UN resolution that would condemn the country’s human rights violations has received support from several Arab nations.

In a growing sign of regional opposition to President Bashar al-Assad’s crackdown on democracy protests, a draft resolution circulated by European countries to the General Assembly's human rights committee on Thursday was backed by Saudi Arabia, Qatar, Jordan, and Morocco.

The European and arab co-sponsors decided to press for the resolution after the 22-member Arab League suspended Damascus on Wednesday over the crackdown and threatened economic sanctions if the government continued to violate an Arab-brokered peace plan. It gave Assad's government three days to halt the violence, which the UN estimates has killed more than 3,500 people, and accept an observer mission.

At least 22 people, including 18 civilians and four defected soldiers, were killed on Thursday, bringing the two-day toll to 49 dead, Syrian activists said.

Mark Lyall Grant, the British ambassador to the UN, said the draft resolution was the result of close consultations with the Arab League, and he urged the human rights committee to show "that the UN will not allow atrocities in Syria to go unchallenged.''

If the resolution is approved by the human rights committee, it is virtually certain to be adopted by the 193-member General Assembly. While resolutions approved by the assembly are not legally binding, they do reflect world opinion.

"True civil war"

Amid reports of violence on Thursday, Russian Foreign Minister Sergei Lavrov told reporters that the West and the Arab League should not just single out President Assad over the violence, but also urge restraint from the opposition.

"Today I saw a television report about some new so-called rebel Free Syrian Army organising an attack on the government building, on the building belonging to Syria's armed forces," he told reporters.

"This was quite similar to a true civil war."

Russia and China last month vetoed a council resolution condemning the deadly crackdown on the eight-month-old uprising which the UN says has caused at least 3,500 deaths.

Turkish Prime Minister Recep Tayyip Erdogan criticised the international community on Thursday for remaining indifferent to the events in Syria because the country is not rich in oil.

"The silence and indifference of those who spoke out against Libya to the massacres in Syria create irreparable wounds on the human conscience," Erdogan said at an international energy conference in Istanbul.

Erdogan's comments came just after the leader of Syria's exiled Muslim Brotherhood said that his compatriots would accept Turkish "intervention" in the country to resolve months of bloody unrest.

"The Syrian people would accept intervention coming from Turkey, rather than from the West, if its goal was to protect the people," Mohammad Riad Shakfa, Syria's Muslim Brotherhood leader, said in Istanbul.

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