(Bloomberg) -- Prime Minister Pedro Sanchez should avoid reversing legal changes made by the last Spanish government aimed at reducing the cost to companies of hiring staff as he seeks to mitigate the impact of the coronavirus pandemic, Pablo Isla, chairman of Inditex SA, said.
“Spain's economy needs to be more flexible and competitive and no rigidity that could be negative for job creation should be introduced,” Isla said in a rare public intervention at a business conference broadcast online from Madrid on Monday. The economy was already weaker than others in Europe before the pandemic hit the country in March, he said.
Isla made his comments as politicians and business leaders lock horns over the best way to bounce back from a crisis that could cause the economy to shrink as much as 15% this year in a worst case scenario, according to the Bank of Spain.
Unidas Podemos, the junior partner in Sanchez's Socialist-led coalition, is pushing to roll back a labor reform that it says punishes workers excessively. Meanwhile, Economy Minister Nadia Calvino says she's against wholesale changes to legislation aimed at making it easier and cheaper for companies to hire staff.
Isla's comments carry special weight because Inditex, owner of the Zara brand, tends to shun the public limelight. The clothing retailer, worth 73 billion euros ($82 billion) in the stock market, is Spain's largest company by market value.
On the fiscal front, the public debate should center on how to generate more economic growth and “therefore more income from taxes” rather than on higher taxation rates, Isla said. He was one of the speakers at a conference organized by the CEOE, Spain's main business lobby.
©2020 Bloomberg L.P.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
