Prime Minister Jose Luis Rodriguez Zapatero has said that Spain's economy would begin emerging from recession 'at the end of this year or the beginning of 2010', though he acknowledged that unemployment - now nearly 18 percent - would remain high for some time.

The premier discussed the measures taken by the government, noting that they served to 'alleviate the crisis' but had not yet yielded net employment gains.

In remarks to the Senate, Zapatero responded to criticism from the conservative main opposition Popular Party by highlighting some initiatives, such as 18.75 billion euros ($27.37 billion) in government lending to businesses, households and regional administrations.

The State Local Investment Fund has kept 14,000 businesses, mostly small and mid-sized firms, from closing and provided jobs to some 421,000 people, the prime minister said.

Popular Party spokesman Pio Garcia Escudero, for his part, criticised the 'errors' made by the government 'with its policy of deficits and debt that mortgage the future'.

The prime minister's comments came hours after the Labour and Immigration Ministry released figures showing that unemployment increased by 98,906 people in October, compared to September, bringing the total number of jobless in Spain to more than 3.8 million.

The number of unemployed people in Spain has risen 35.14 percent in the past year.

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