LOS CABOS, Mexico — World leaders’ relief at Greek voters’ rejection of a government that could have forced the country’s exit from the European currency union evaporated Monday with the continued severity of Europe’s economic problems.
Spain’s borrowing costs climbed past levels where Greece and two other European countries had been forced to seek bailouts. Financing the Spanish government would likely be too expensive for the eurozone bailout funds to handle. Spain’s $1.39 trillion economy is bigger than those of Greece, Ireland and Portugal combined.
Heads of state began bilateral meetings ahead of the G20 summit with the crisis facing Spain, Greece, Italy and other European economies at center stage. The Spanish government bemoaned the rise in its borrowing costs, saying it didn’t correspond to the reality of Spain’s economic strength.
“We in the government are convinced that the current situation of punishment in the markets, what we’re suffering from today, doesn’t correspond with the efforts, or the potential, of the Spanish economy,” Spanish Economy Minister Luis de Guindos said.
President Barack Obama and Mexican President Felipe Calderon of the host country downplayed chances for concrete results going into the summit.
