Spain’s prime minister Pedro Sánchez has carried out a far-reaching reshuffle of his government as the ruling Socialists seek to regain the initiative after a series of political, economic and diplomatic setbacks.

In a much wider-ranging reshaping of the government than expected, Sánchez promoted Nadia Calviño, economy minister, to become his new number-two as several of the most prominent figures left office.

In an address to the nation, Sánchez announced the formation of what he described as a new government that would focus on economic recovery and the use of the €140bn in EU funds that Spain hopes will help it bounce back from the ravages of the coronavirus pandemic — and which the government is relying on to revive its fortunes.

“The government of recovery begins today, to overcome the worst calamity in decades,” Sánchez said. He added that the personnel change also heralded a “generational renewal”, with the average age of ministers falling from 55 to 50 and the percentage of women rising from 54 to 63 per cent.

Among those departing the coalition were Carmen Calvo, Sánchez’s previous principal deputy, as well as foreign minister Arancha González, the prime minister’s chief of staff and strategist Iván Redondo and José Luis Ábalos, a Socialist veteran who served as minister of transport.

The new foreign minister will be José Manuel Albares, a former Sanchez adviser who currently serves as ambassador to France, and who prides himself on his diplomatic experience and closeness to the prime minister.

The promotion of Calviño — a former top European Commission official — means she will chair cabinet meetings in Sanchez’s absence.

“This move underlines her status as an essential part of this government; it’s also a signal to markets and Brussels of its commitment to economic orthodoxy,” said Pablo Simón, professor of politics at Madrid’s Carlos III University.

But he added that the reshuffle “was practically trying to start the government again from zero” just under half way through parliament’s four-year mandate.

The Socialists have fallen behind the centre-right People’s party in the polls in the wake of their devastating defeat in a Madrid regional election. The government has also become embroiled in a diplomatic crisis with Morocco, which in May briefly allowed thousands of migrants to cross over to the Spanish enclave of Ceuta.

Spain’s gross domestic product contracted more as a result of the pandemic than that of any other major economy, shrinking 10.8 per cent last year.

The country’s economic prospects have been further clouded by the country’s fifth Covid wave, which last week pushed its infection rate to the highest in mainland Europe, throwing the tourist season into jeopardy.

In normal times, tourism generates 12 per cent of Spain’s GDP and 13 per cent of jobs, with the months of July and August playing an outsize role. Last week, Germany and France warned their citizens against travel to the country.

Among other changes, the reshuffle replaced the heads of the education, justice, science and culture ministries and appointed a new government spokesperson, Isabel Rodríguez.

Simón pointed out that not only were many ministries changing hands but that the four top officials co-ordinating policy under Sánchez — who included Calvo, Redondo and Ábalos — had left office.

The fourth member of that group, Pablo Iglesias, the former leader of the Socialists’ radical left coalition partner Podemos, left politics after coming fifth in the Madrid election.

Iglesias had previously been replaced as a deputy prime minister by Yolanda Díaz, Spain’s communist minister of labour. Podemos’s five ministers were not part of Saturday’s reshuffle.

Spain’s opposition parties responded to the changes by labelling Sánchez, not his ministers, the problem, and calling for elections.