Spain is vulnerable

Spain is now the big worry for EU policymakers because it accounts for around 10pc of the euro-zone economy, in contrast to Greece, Ireland and Portugal, which account for less than 2pc each. A bailout for Spain would take up all the available funds which would leave nothing for countries like Italy which would suffer contagion.

Spain's borrowing costs have soared this year as investors worry that its high deficit - the hangover of a property crisis that has yet to fully unwind - could push it the way of the Greek and Irish debt crises.

The country’s savings banks were hugely exposed to bad debt accumulated during the property boom, and have now undergone a restructuring process via government funding and a wave of mergers which has reduced their numbers to less than 20 from 45.

If Spain's plan to cut the deficit to 6pc of gross domestic product next year from 11pc last year shows any signs of being unattainable, it could become the next target of market concerns over debt in the euro zone periphery. 

Let us hope that the measures put in place are successful