• Demonstrators and police clashed in Madrid this morning
• Reports of arrests and injuries
• Protests also seen in Malaga, Valencia and Barcelona
• Energy usage down 20%
• OECD says eurozone struggling, and UK in recession
• Today's agenda
In the financial markets, Spanish government bonds have fallen in value today. That's pushed up the yield (effectively the interest rate) on its 10-year bonds to 5.45%.
That reflects fears that Spain will, despite its best efforts, be forced to take an aid package from the international community. Yesterday, analysts at Citigroup predicted that the cost of recapitalising its banks (which face huge losses on property loans) will force Spain into accepting a programme of financial help tagged to further economic reforms.
Stock markets are also lower:
Spain's IBEX: down 0.8% at 7915
Britain's FTSE 100: down 0.7% at 5768
German DAX: down 1.02% at 6927
French CAC: down 0.9% at 3398
The euro has also fallen, down around 0.3 of a cent against the US dollar to $1.3288.
Another photo, this time from Madrid, showing demonstrators on the Gran Via avenue.
There are reports of heavy traffic jams in parts of Madrid (see 8.21am for details of how a main road into the city was blocked earlier).
With public transport operating a skeleton service, the long queues may also indicate that many workers have attempted to get to work in their own cars.
But the protests do appear generally calm. Most of the arrests and injuries (such as the cut suffered by this protestor) occured at early morning protests, where demonstrators appear to have tried to stop lorries reaching wholesale plants, or buses leaving for work.
In Barcelona, around two hundred university students marched down the Diagonal Avenue - one of the city's main roads - this morning, during the general strike.
The protest, which appears calm, would have added to transport problems in Barcelona, where commuter train services had also been hit by today's action.
Some Spanish Twitter users have found black humour in today's general strike, using the #huelga or #enhuelga hashtags.
One widely retweeted message from @jorgenavasalejo proclaims "Confirmed: 100 percent paralysis of Castellón and Ciudad Real airports, with the latter opting for permanent strike".
Confirmado: 100% paralizados los aeropuertos de Castellón y Ciudad Real, que parece que han optado por una huelga indefinida #enhuelga
— Jorge Navas Alejo (@jorgenavasalejo) March 28, 2012
The pun is that both new unused airports are white elephants – and standing jokes – left over from Spain's building boom. Neither one is currently receiving commercial flights of any kind and they remain as symbols of all that went wrong before Spain's construction bubble burst. In fact Twitter is today alive with jokes about Castellón airport, with @magdabermellon claiming the rabbits are refusing to unblock the runways.
Spain's national police force @policia, meanwhile, has proclaimed on Twitter that: "Thousands of agents are today protecting the right to go on strike (#huelga)... or not to."
Our Madrid correspondent Giles Tremlett reports that Spanish police seem upset about a suggestion by the governing People's party (PP) of prime minister Mariano Rajoy that social networks should be used to denounce illegal picketing or violence in today's general strike.
He writes:
Esperanza Aguirre, the PP head of the regional government of Madrid, had called on people to "put up on social networks any photos or videos" of "any act of violence or of coercion by pickets". She has repeated the idea on her own Twitter feed.
But Spain's National Police force has just put out its own tweet, asking people not to use Twitter for official complaints.
"Please, for warnings, incidents, queries or requests for help about #huelga (strike) do not use Twitter. Dial 091. The coordination is better there," it says.
Today's industrial action comes two months, almost to the day, since Spanish PM Mariano Rajoy was caught telling fellow leaders that his labour reform plan "is going to cost me a general strike."
That disclosure, made at an EU summit, was plastered over the Spanish media, along with Rajoy's warning that "the most difficult part comes now".
Demonstrators have been enthusiastically plastering stickers and posters around Spanish cities.
This sticker was pasted to a window at Atocha railway station in Madrid. It reads "No to labor reform and abusive lay-off, general strike".
As we explained earlier, Mariano Rajoy's government has brought in legislation that makes it easier for firms to lay off workers, cut their wages, or change their working conditions, if they can claim they need to boost their productivity.
The Organisation for Economic Co-operation and Development has just released its latest economic forecasts -- and there's bad news for the eurozone, and the UK.
According to the OECD, Britain is now in recession. It expects that GDP in the current quarter has fallen by 0.1%, adding to the 0.3% decline seen in the final three months of 2011.
On the eurozone, the OECD said that it is falling behind the US, which is expected to grow much faster. It expects the eurozone's three largest economies (German, France and Italy) to shrink by 0.1% in the first quarter of 2012, amd grow by slightly more than 0.2% in the second quarter.
The US is expected to post growth of 0.725% in Q1 2012, followed by 0.7% in Q2.
A quick reminder of Spain's economic position.
Spain ended 2011 with a shrinking economy. GDP fell by 0.3% in the final three months of the year, and it is forecast to drop by another 1.7% during 2012.
The country has one of the weakest employment markets in the eurozone. Unemployment broke through the 5 million mark in January, putting the jobless rate at almost 23%. More than half of all young people are out of work.
Spain posted a deficit of 8.5% of GDP last year, well above official target. It is now aiming for a deficit of 5.3% of GDP this year. Friday's budget will show how prime minister Rajoy will attempt this.
Spain's transport network has been badly hit by today's strike.
Spanish airline Iberia (which merged with British Airways in 2010), says it has cancelled more than 400 flights. Another 44 Ryanair flights have been grounded, while easyJet cancelled 28 flights.
Ahead of today's action, transport employees had agreed to offer a minimum level of service. That meant that around 25% of buses and a third of train services were expected to operate.
The two main unions, Comisiones Obreras and UGT, have announced that the general strike had "practically paralysed" factories during the night shift. They also claimed that 85% of workers in the food sector were also taking part (but, as we reported at 8.36am, we won't know the full story for some time).
And here's a less peaceful photo, showing a man bleeding while taking part in this morning's protests in Madrid.
According to the photographer who took the photo, the man had been hit in the face by police.
Back to Spain, and there have been peaceful protests this morning outside the Gregorio Maranon Hospital in Madrid.
Sony Kapoor of the Redefine think tank argued that the rarity of today's general strike (the first since September 2010) shows that the 'social fabric' of Spain has held up well since the financial crisis began.
The rare #Spanish general strike today only goes 2 show how well the social fabric has held fast so far. Will it last as unemployment rises?
— Sony Kapoor (@SonyKapoor) March 29, 2012
Looking away from Spain briefly, Geman unemployment has fallen again, as the eurozone's largest economy continues to shrug off the debt crisis.
On a seasonally adjusted basis, the number of people out of work in Germany fell by 18,000 in March to 2.841m. That takes the country's unemployment rate down to 6.7%, a new record low.
Giles Tremlett, our correspondent in Madrid, tells me that it is impossible to say at this stage how 'successful' the Spanish general strike is. But two key indicators suggest there is more support than at a similar event 18 months ago.
Giles writes:
The first is that electricity consumption is down by more than 20% – proof that things are slowing down around the country.The other is that unions say more people have stopped work this morning than in September 2010, when the socialist administration of José Luis Rodríguez Zapatero had to cope with a similar strike.
Zapatero himself considered that strike a crucial moment in the dramatic fall in popular support for his socialists, who were ousted at a general election a year later.
Given that regional elections in southern Andalucia at the weekend saw a fall in votes for current prime minister Mariano Rajoy's conservative People's party (PP), it is safe to say that we have reached a turning point in support for the government as it celebrates 100 days in power.
Tomorrow's budget, expected to be one of the fiercest seen in austerity Europe, will mark the end of his toughest week in power.
El Pais also reports that Esperanza Aguirre, president of Madrid Spain minister for education and culture, has denounced attempts on social networks to create public disorder today [a comment which reminds us of last summer's riots in the UK]
Apologies, we appear to have misread Aguirre's comments - please see 11.09am for the full story.
According to El Pais, there have been 58 arrests so far in Spain, with seven policeman injured (my colleague James Gard reports).
Electricity demand is reportedly down a quarter on a normal working day. Nissan and Seat car factories in Catalonia are locked down. Student protestors have blocked one of the main roads into Madrid, the A6, causing a big traffic jam (click on the link below to see).
Así está la entrada a Madrid por la A-6. Los estudiantes han bloqueado el acceso a Moncloa. #yohagohuelga twitpic.com/92pwge
— Comisiones Obreras (@ccoo) March 29, 2012
The Spanish general strike comes just a day before prime minister Mariano Rajoy announces a new austerity budget.
As my colleague Giles Tremlett reported a few days ago, Rajoy must announce up to up to €40bn (£33.45bn) of spending cuts and taxes, three months after his victory in a general election last November.
Rajoy has also angered labour groups by introducing new legislation that makes it easier for companies to lay people off, cut wages and modify other employment conditions. This has led unions to predict enthusiastic support for today's action.
Ignacio Fernandez Toxo, head of the CCOO union, declared:
The people will say whether they are resigned to accepting the reforms.
Finance minister Cristobal Montoro, though, insists the Spanish government will not be forced into changing its plans. Montoro said:
The question here is not whether the strike is honoured by many or few but rather whether we get out of the crisis.
And in Valencia (as in Malaga, see 7.56am) strikers also blocked the entrance to the main wholesale market (called Mercavalencia).
According to local reports, hundreds of members of the UGC, CCOO and CGT labor unions, blocked the entrance, and managed to prevent trucks entering the site.
In Malaga, union members picketed outside the entrance to the city's main food warehouse, called "MercaMalaga".
Here's another picture from outside Madrid's urban bus depot:
It was taken before dawn today, and shows a demonstrator shouting a slogan while a policeman stands by.
In Madrid, several people have been detained by police in riot gear, after demonstrators tried to stop an urban bus leaving for work.
Here's a picture from the scene.
Here's today's agenda:
• General strike in Spain: all day
• Informal talks in Copenhagen ahead of Friday's EU finance ministers meeting: all day
• German unemployment data for March: 8.55am BST / 9.55am CET
• UK mortgage approvals/consumer credit data for February: 9.30am GMT
• Eurozone consumer/industrial/business/services confidence: 10am BST / 11am CET
• US GDP for Q4 2011: 1.30pm BST / 8.30am EST
Good morning, and welcome to another day of rolling coverage of the eurozone debt crisis.
Today the focus is on Spain, where a general strike has begun. Unions have called the industrial action in protest against the economic reforms, and austerity measures, being introduced by its new centre-right government.
The general strike is seen as a big test for prime minister Mariano Rajoy. Three months after sweeping to power, does he still command the support of the public?
There have already been clashes between demonstrators and police in Madrid and Malaga. There's likely to be disruption throughout the day, with marches taking place this evening.
The strike comes as EU finance ministers and officials head to Copenhagen for the start of crunch talks over the eurozone crisis, and the issue of the European firewall.
On the economic front, we have German unemployment and eurozone consumer confidence coming up, plus a new estimate for US GDP for the final three months of 2011. Busy day ahead....
Source: http://www.guardian.co.uk/business/2012/mar/29/eurozone-crisis-spanish-general-strike
Lee Carsley Radio industry Bank of England Argentina Dmitry Medvedev Alex Reid
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