Spain enters "painful" recession

Spain's economy has fallen into a recession for the first time since 1993, new figures from the country's central bank have revealed.

According to the Bank of Spain, gross domestic product contracted by 1.1 per cent during the fourth quarter of 2008, following on from the fall of 0.2 per cent that was recorded in the previous quarter.

And the country's dependence on the construction market has also compounded its problems, as the real estate sector struggled over the course of 2008.

"Spain is going through a very sharp correction having grown very rapidly for a decade," Dr James Nixon of Societe Generale told the BBC, a downturn he described as "painful".

The news may be welcomed by investors who have been looking at purchasing property in the country, as they could be able to take advantage of falling prices.

Last month, the country's government announced that it is to invest EUR19 billion (GBP 17.4 billion) in infrastructure.

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