Spain cancels € 6.4 billion of infrastructure projects

Spain's Ministry of development has it is to delay construction work on 199 major public works projects, while 32 will be cancelled altogether. The cancellations and postponements are worth € 6.4 billion and equate to 20% of the contracts under the Ministry's control. They form part of Spain's current round of budget cuts.

Despite the cuts, Development Minister Jose Blanco was at pains to point out that spending on public infrastructure would continue at pre-bust levels. Spain's stimulus spending plan includes a 'Special Infrastructure Plan', which will be untouched by the current round of cuts. This year it includes some € 5,57 billion for infrastructure work.

As a results, the Minister said infrastructure spending form 2009 to 2012 will stay around the annual average of € 14 billion send from 2005 to 2008. He added that this was above the average of € 8,4 billion seen from 2000 to 2003.

The cuts being made will hit the rail and road sector and infrastructure projects in the air and maritime segments will not be affected. Mr Blanco said that although the cuts were, "Severe and necessary," they would, "Contribute to the sustainability of our public accounts and budgetary stability."