Spanish newspaper withdraws 'fake photo' of Hugo Chávez

Spain's influential El País newspaper has withdrawn what it says was a false photo of Hugo Chávez that it published in its online and print editions on Thursday.

The grainy photo that El País originally splashed on its front page, billed as a global exclusive, portrayed the head of a man lying down with a breathing tube in his mouth.

The Venezuelan president has cancer and has been undergoing medical treatment in Cuba, where he had surgery in December. He has not been seen publicly for six weeks.

El País, one of the biggest Spanish-language publications in the world and an institution both in Spain and in Latin America, said in a brief online statement that it had withdrawn the photo after ascertaining that the image was not of Chávez.

Venezuelan political opposition leaders have criticised government secrecy over Chávez's condition while his supporters have accused foreign media of being in league with the opposition to spread rumours that the president's medical condition is worse than it is.

Spain's unemployment rate reaches record high

Nearly 55 percent of Spanish youth under 25 years out of job as unemployment rate surges to 26 percent in final quarter.

Spain's unemployment rate has surged to a modern-day record of 26.02 percent in the final quarter of 2012 as nearly six
million people searched in vain for work in a biting recession, official data shows.
The jobless rate data released on Thursday climbed from 25.02 percent the previous quarter, reaching the highest level since Spain returned to democracy after the death of General Francisco Franco in 1975.
The story for young people was even grimmer: the unemployment rate for those aged 16 to 24 soared to 55.13 percent, up from 52.34 percent the previous quarter.
The result shattered even the modest expectations of Prime Minister Mariano Rajoy's government, which had been forecasting an unemployment rate of 24.6 percent by the end of 2012.
"It is a very, very high figure," said Soledad Pellon, market strategist at IG Markets in Madrid.
"The expectation is that this figure will carry on growing during 2013.
This year will still not be a year in which we will see job creation," she said.

Spain's PM defends party from corruption inquiry

 Spanish Prime Minister Mariano Rajoy vowed action against wrongdoers in his ruling People's Party (PP) after revelations of a former treasurer's Swiss bank account threatened to stir a deeper party crisis.

An ongoing judicial investigation of former PP treasurer Luis Barcenas last week showed he had a Swiss bank account which at one point held as much as 22 million euros ($29 million), according to a court document and statements by court officials.

Barcenas stepped down as party treasurer in 2009 when judges began to investigate his possible involvement in alleged illegal payments and kickbacks to party officials from builders and other businesses that won government contracts.

PP leaders have denied any knowledge of illegal schemes but Rajoy said he would act if wrongful activities were found.

Spain’s government Rosy scenario

The Spanish government is newly optimistic, but many Spaniards are not . IN MADRID ministers brag that they have turned a corner. Euro-zone bond yields have been hitting new low levels (see article). Spain’s banking and labour reforms are now in place. Growth will revive later this year or in 2014. Jobs, the Spanish El Dorado, will eventually follow.

But that is surely too rosy a view. Exports are growing and the current account is now in surplus, but even the government sees GDP shrinking by 0.5% in 2013 (and most analysts talk of 1.5%). Spaniards are suffering an aching spell of record unemployment, at 26.6%. Austerity means worsening public services just as real wage and pension cuts make people poorer. The biggest asset for many families, their house, is plunging in value, with a further 20% price fall expected. Higher income, sales and housing taxes will hit spending power further. Business confidence and retail sales are in retreat. And a housing glut will take years to digest. Only 25,655 of what Fitch, a ratings agency, says are 1.2m unsold Spanish houses were bought in November.

Spain must eventually emerge from all this. But will Spaniards put up with extended pain? Or will they rebel against a political establishment that has failed them? So far they have been quietly dignified. Peaceful demonstrators have made more headlines than violent protesters. Yet days lost to strikes are at a ten-year high. A budget deficit of 7-8% of GDP in 2012 must be cut this year. The European Union has set a 4.5% target, though it may relax this. Investment has already been slashed so future cuts must fall on public health, education, pensions and welfare services.Polls show most politicians in the doghouse. Barely half of all Spaniards back the two parties that have governed for three decades: the ruling People’s Party (PP) of Mariano Rajoy or the opposition Socialists. The communist-led United Left has surged to almost 16%, while Rosa Díez’s centrist Union for Progress and Democracy stands at 10%. Spaniards blame the Socialist government of José Luis Rodríguez Zapatero for dropping them in the mess, and Mr Rajoy’s PP for failing to get them out of it, says Juan José Toharia of Metroscopia, a pollster. Only one in six Spaniards has confidence in Mr Rajoy.