Spain signals continuity with appointment of Cuerpo as economy minister

Spain signals continuity with appointment of Cuerpo as economy minister

By Belén Carreño and David Latona

Spanish Prime Minister Pedro Sanchez on Friday appointed Carlos Cuerpo, a close ally of the outgoing Nadia Calvino, as new economy and trade minister.

Cuerpo, 43, said in his first speech that there would be continuity in his policies with those of his predecessor, who departs with the economy growing by nearly 2.5% in 2023, well above its euro zone peers, and inflation at 3.1% in December.

He also made a commitment to improving the lives of young people.

"We can't afford to fail," Cuerpo said.

His appointment ended weeks of speculation after Calvino was named head of the European Investment Bank earlier this month.

Sanchez also promoted Budget Minister Maria Jesus Montero to be his first deputy prime minister, a position until now held by Calvino.

As the Socialist Party's number two, Montero's appointment can be interpreted as an attempt by Sanchez to surround himself with loyalists capable of defending his policies in a government lacking an outright majority in parliament.

Cuerpo, a senior civil servant since 2008, has played a key role in discussions on the European Union's new package of fiscal rules, serving as negotiator for Spain's rotating presidency this year.

He pledged to reduce Spain's debt and deficit to ensure "we continue to enjoy the confidence of investors".

"The EU's fiscal rules will take priority in the coming years," he said.

Spain must narrow the deficit to 3% in 2024 from a 3.9% budget shortfall forecast for 2023, and begin significantly reducing its debt-to-GDP ratio, which is expected to reach 106.3% in 2024.

Cuerpo will also oversee the implementation of the 120 billion-euro ($133 billion) European recovery plan in Spain and manage the impact of the phasing out of anti-inflationary measures.

Like Calvino, Cuerpo worked within the European Commission, making him familiar with the inner workings of Brussels' complex bureaucracy.

He holds a PhD in economics from the Autonomous University of Madrid and a Master's degree in economics from the London School of Economics and Political Science. Those who have worked with him describe him as "gentle and friendly".

Calvino, 55, had been the economy minister since June 2018, when Sanchez first became prime minister.

Widely seen as a technocrat, she is a career civil servant and not a member of Sanchez's Socialist party. She has been the chair of the IMF steering committee since December 2021.