Spain relies on troops to keep order

SPAIN is braced to extend its state of emergency after a strike by air traffic controllers last week shut down the country last week.

The army took over the running of control towers until the threat of jail forced the controllers back to work. They were protesting the proposed privatisation of Spain’s airports as part of a package of debt-busting measures.

Prime Minister Jose Luis Rodriguez Zapatero said the state of emergency could continue “depending on how the circumstances evolve”.

Ever since Ireland applied for bailout aid, the pressure has been turned up on Spain and Portugal, with their borrowing costs rising steadily.

And in comments that could fuel market pressure on Madrid, Austrian chancellor Werner Faymann was quoted as saying that Spain would resist to the last but may not be able to avoid seeking a bailout.

Portugal, widely seen as the next Eurozone “domino” at risk of a bailout, has resisted announcing new measures on top of a tough 2011 budget approved last month.

Greece is also struggling to meet tough deficit targets agreed as part of its €110bn (£93bn) rescue and is under pressure to do more. Its central bank governor urged the government to step up the pace of reform, saying Athens should be striving to beat the fiscal goals set for it.