Tiny Murcia yesterday became the second Spanish region to say it would tap an €18 billion (£14bn) government programme to keep its finances afloat, while media reported half-a-dozen governments would follow in the footsteps of Valencia.
The announcement by the heavily indebted eastern region of Valencia on Friday that it would need help from Madrid spooked financial markets and complicated central government efforts to stave off a full-blown sovereign bailout.
The funding will help the regions deal with their borrowings – but it comes with strict fiscal conditions. Catalonia, Castilla-La Mancha, the Canaries, the Balearics and Andalucia are also likely candidates for the mechanism.
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