Italian prime minister Mario Monti sparked an EU tiff with his comments on struggling Spain, but, after an angry reaction from the Spanish, all sides now appear to be back peddling fast and trying hard to mend the rift. Speaking at a conference on labor reforms last weekend ( March 25 ) Monti said, “Although Spain has without doubt made far reaching labor reforms, the same level of attention hasn't been paid to the public debt.” Spain, said Monti, quoted by 20minutos, was causing “great concern” across Europe and there are fears Spain's woes could affect everyone via contagion.

His remarks caused some upset. Monti said his comment hadn't been understood and Spanish President Marian Rajoy said Monti had personally explained his comments and, for President Rajoy at least, the remarks were now “things from the past.” Rajoy also pledged to tackle Spain's economic problems together with the EU.

It's been a belligerent few day for Italy's Mario Monti – he also threatened to resign if his proposed labor reforms are not adopted, making a comment that translates roughly as “If you don't want my reforms, fine, I'll go home.” Italian trade unions are opposing the reforms and a general strike is threatened.

Liam Lever, liam@romania-insider.com