Spain's economic crisis: a timeline Standard & Poor's is the first credit rating agency to downgrade Spain, cutting its treasured AAA rating by one notch to AA+. Spain adopts an economic stimulus plan worth an estimated 5pc of GDP, including €8bn (£6.5bn) euros of infrastructure projects. The Bank of Spain bails out regional lender Caja Castilla-La Mancha, the country's first bank rescue in recent years. May-June 2009 Spain creates a bank bail-out fund, known as the FROB, with firepower of up to €99bn euros and urges weaker savings banks to merge to improve solvency. First quarter 2010 Spain's economy exits recession. April 2010 As talks intensify on granting Greece an economic bailout, attention turns to Spain amid worries over its public deficit - 11.2pc of GDP in 2009. After initially denying Spain was in trouble, Zapatero announces austerity measures worth around 1.5pc of GDP. Austerity measures passed over the following six months, including a two percentage point rise in VAT, are worth an estimated total of 5pc of GDP. Spain's cabinet approves a labour market reform. The bill is passed through parliament in September. December 2010 The central government forces the country's 17 autonomous regions, considered the weak link in spending cuts, to publish more details of their accounts. January 2011 Spain passes pension reform that will gradually raise the retirement age to 67 from a previous 65. Zapatero decides to bring forward national elections to November, four months early. September 2011 Parliament passes a constitutional amendment forcing governments to keep balance budgets. November 2011 Mariano Rajoy's centre-right People's Party wins an absolute majority in November 20 elections as voters punish the outgoing Socialist government for the economic crisis. December 2011 New government says on December 30 that the public deficit for 2011 would come in at 8pc of GDP, well above a target of 6pc. The government also announces new austerity measures with a cut in public spending by €8.9bn in 2012 for all ministries. Treasury Minister Cristobal Montoro announces tax hikes to focus on the wealthy, raising around €6bn. January 2012 Spain ends 2011 with almost one-in-four of its economically active population out of work. The jobless rate jumps to 22.85pc, or 5.27m people - the highest in the European Union. March 2012 Spain will aim to save more than €27bn in its 2012 budget through corporate taxes, freezing civil servant wages and ministerial spending cuts. Rajoy has said he will reduce the budget deficit to equal to 5.3pc of GDP in 2012 from 8.5pc of GDP in 2011. First quarter 2012 Economy falls back into recession. April 2012 Thousands of people protest across Spain against government cuts aimed at tackling the debt crisis. Government says 2011 public deficit 8.9pc of GDP. Bankia asks for a €19bn state rescue on May 25. Spain is nationalising Bankia, which holds some 10pc of the country's bank deposits, weighed downn by heavy losses from the property crash. Montoro says Spain's high borrowing costs mean it is effectively shut out of the bond market and the EU should help Madrid recapitalise its debt-laden banks. Spain still needs to refinance about €82bn of debt in 2012, while helping its regions to repay maturing debts of about €16bn in the second half of 2012.