The 76-year-old monarch said the decision was aimed at reviving the scandal that hit the monarchy at a time of economic hardship and growing discontent with the wider political elite.
Carlos said that a new generation was quite rightly demanding to take the lead role.
The pronouncement came hours after a surprise announcement from Prime Minister Mariano Rakoy that the monarch would step down after almost 40 years on the throne.
The once popular Carlos, who helped smooth Spain’s transition to democracy in the 1970s after the Francisco Franco dictatorship, has been increasingly out of touch in recent years.
A corruption scandal in the family and his visible infirmity after repeated surgery in recent years have also eroded public support for the family.
Opinion polls show greater support for the 46-year-old Felipe who has not been tarnished by the corruption allegations.
The king’s younger daughter, Princess Cristina, and her husband, Inaki Urdangrain, are under investigation.
A judge was expected to decide soon whether to put Urdangarin on trial on charges of embezzling six million euros in public funds through his charity.
He and Cristina have since denied the allegations.
A palace source who spoke on condition of anonymity said that the abdication was for political reasons.
The source said the king decided in January to step down but delayed the announcement until after the European Union election on May 25.
Political analysts said the ruling conservative People’s Party (PP) was eager to put the more popular Felipe on the throne to try to combat increasingly anti-monarchist sentiment after small leftist and anti-establishment parties did surprisingly well in the election.
Jordi Virgili, a professor of political communication, said the move had become imperative because people were calling for political regeneration.
He said it was more of a change in the institutional functioning of the state after around 40 years of democracy and they had started with the royals.
Virgili said Spain did not have a precise law regulating abdication and succession.
He said Rajoy’s cabinet was scheduled to have an extraordinary meeting on Tuesday to set out the steps for Felipe to take over.
Virfili said the transition would be accomplished by passing a law through parliament, where the PP has an absolute majority.
There had been media speculation over the abdication since last year and 62 per cent of Spaniards were in favour of the king stepping down. (Reuters/NAN)
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