PM Rajoy Says Spain Faces Tough Year Ahead

Spain's prime minister says the country's economy faces a tough year ahead as it grapples with recession, a deep financial crisis and 25 percent unemployment.

In his end-of-year assessment Friday, Mariano Rajoy said the country's crisis had been worse than anticipated, warning that the first half of 2013 will be "very hard" with any recovery not expected until the latter part of the year.

Rajoy added that the government was adjusting the country's deficit "at a time of recession" which was a tough time to try and achieve such a turnaround.

The stinging austerity measures his government had been forced to introduce had been tough, Rajoy admitted, but he added that "without reforms, the country's health and education sectors could not have been maintained."