Spain prepares to pass reforms, budget cuts

Spain will announce a series of economic reforms and a tight next year budget on Thursday, aiming to avoid the political humiliation of having Brussels impose conditions on a request for an international bailout.

Some ministries could see their budgets slashed by up to a third, Spanish media said, as Prime Minister Mariano Rajoy’s battle to reduce one of the euro zone’s biggest deficits is made stil harder by falling tax revenues in a recession.

“We know what we have to do, and since we know it, we’re doing it,” Rajoy said on Wednesday as street protests in Madrid and secession talk by the northeastern Catalania region compounded his goverment’s problems.

“We also know this entails a lot of sacrifices distributed... evenly throughout Spanish society,” he said while visiting New York to attend the U.N. General Assembly.

Details are to be announced at a news conference starting at 8pm HK time following a cabinet meeting.

Thousands of anti-austerity demonstrators demanding that Rajoy resign gathered for a second night on Wednesday near the parliament building, which was guarded by hundreds of police. Protests on Wednesday were peaceful after a march on Tuesday ended in clashes with police.