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Germany signals it will continue EU austerity drive

Published on Aug 26, 2014 2:53 AM
German Chancellor Angela Merkel waves next to Spanish Prime Minister Mariano Rajoy before a news conference in Santiago de Compostela, northwestern Spain, August 25, 2014. Both Merkel and Rajoy, who have been allies in stabilising the finances of heavily indebted Spain, defended the need for further austerity and economic reforms, saying this boosted economic growth. -- PHOTO: REUTERS

MADRID (AFP) - Germany strongly signalled Monday it will continue to push for fiscal austerity in Europe alongside Spain, even as France was thrown into political turmoil over its economic policy.

German Chancellor Angela Merkel praised Madrid's austerity drive during a visit to Spain and gave her powerful backing to the country's economy minister in his bid to lead the Eurogroup forum of finance ministers.

Merkel hailed Luis de Guindos' handling of the Spanish crisis, saying he was "an excellent economy minister in Spain in difficult times" during a joint press conference with Spanish Prime Minister Mariano Rajoy.

The German leader's support could be crucial in landing him the job, which would give the austerity policies favoured by Berlin a powerful defender in the European Commission.

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