IMF: Spain making strong progress but jobs boost needed

The IMF expects the Spanish economy to start to grow later this year

Spain has made strong progress towards fixing its economy, according to the International Monetary Fund (IMF).

However, the IMF warns that the outlook for the country remains tough and has urged more action by the government and European Union to boost job creation.

It expects Spain's economy to start to grow later this year. Spain has one of Europe's highest unemployment rates, currently standing at 27%.

The IMF also says that further moves are needed towards banking reform.

"Strong reform progress is helping stabilise the economy and external and fiscal imbalances are correcting rapidly. But unemployment remains unacceptably high and the outlook is difficult," the IMF said in its report.

"This calls for urgent action to generate growth and jobs, by both Spain and Europe."

The IMF said that the top priority of the Spanish government should be to reform labour laws further, making it easier for companies to change working conditions rather than dismissing employees. It also called for Spain to provide more training to young and unskilled people to help them into work.

Spanish economy minister Luis de Guindos said earlier that the country was "coming out of recession" and budget minister Cristobal Montoro said that economy was "at a turning point".

However the Washington-based IMF cautioned that Spain still faced tough times ahead, with the outlook remaining "difficult".