On Saturday, the International Monetary Fund’s Ajai Chopra, warned that Spain is in for some tough times which will “prevail in Spain for some time,” seeing how the country has high fiscal deficits, low competitiveness and rising unemployment.

The IMF announced on Thursday how most developed economies emerge from recession, but forecast that Spain’s economy will contract by 0.7 per cent in 2010.

The IMF has also called for labor market reforms as well as spending and tax cuts, saying the country needs take action as the road to recovery is long, comparing the road ahead for Spain to that of Germany in the 90s after the reunification.