Half of Barcelona’s bars could disappear following the crisis

Up to half of the bars and restaurants in Barcelona are in danger of being lost forever, according to the city’s Restaurants Association (Gremi de Restauració de Barcelona).

One quarter of such businesses have already closed for good, while another quarter are in danger of doing so. Roger Pallarols, director of the restaurants association, views losing only one third of the city’s bars and restaurants as the “best-case” scenario. 

“Big cities have, as it can be no other way, economies based largely on mobility: mobility of tourism, business mobility, labour mobility,” Pallarols explains to Catalan News. This sudden and drastic reduction of mobility has seen cities such as Barcelona suffer greatly in the past year. 

One such business that has had to close for good is Mario Pérez Ruiz’s restaurant in the Raval neighbourhood of the Catalan capital, L’Àvia. He now runs a used bookstall, 7 Vides, in the same area.

“The building was collapsing,” Pérez Ruiz says. “We were renting and the property owners did nothing. You can’t take safety measures against Covid when the premises are damaged and there’s no ceiling.”

Rafel Jordana describes the situation as “agony.” He runs La Bodega d'en Rafel in the Sant Antoni district of Barcelona, a traditional bar that has been operating for around 60 years right beside the famous Sant Antoni market, and the situation is reaching breaking point for him. 

Revenue has fallen to around 15% that of pre-pandemic times, and he estimates an economic impact of around €100,000 in losses since the beginning of the crisis. “I’ve made up my mind to retire, because rent prices in the neighborhood are too high and current Covid restrictions make it impossible to carry on,” Jordana says.

“I don’t know what the landowner will do when the bar closes. It’s hard for a neighborhood bodega to be viable with current rent prices. Our business model is based on affordable and generous meals, and for people to interact with each other.”

Covid-19 restrictions

Roger Pallarols believes the severity of the situation is not an inevitability, but rather the product of “erratic and irresponsible” government policy in managing the crisis. 

Bars and restaurants in Catalonia have operated with varying degrees of restrictions since the pandemic began, from being strictly shut during the first wave and only being able to offer takeaway services during the winter months, to periods of openness such as last summer when few restrictions were placed on the activity, barring some capacity limits. 

From May 9, though, as soon as the state of alarm in Spain ends, the hospitality industry will once again be able to serve customers on-site late into the evening. Catalan authorities announced on Friday that bars and restaurants will be able to serve customers both indoor and outdoor until 11 pm. 

Pallarols says this opening up comes far too late for the sector but appreciates that their calls have been heard. Overall, he says the “politics of strict measures” has brought a large portion of the sector he represents that would otherwise be able to survive well into “critical” situations. 

Alternative models

For most of 2021, the measures in place to halt the spread of Covid-19 meant that bars and restaurants could only open to serve on-site until the late afternoon, with takeaway and delivery services on offer in the evening. 

The restaurants association points to the examples of northern European countries and the region of Madrid for two very differing alternatives to the current system. Some countries have kept bars and restaurants entirely shut for months on end, while the Spanish capital has placed very few limits on how the businesses can run their operations. 

Northern European countries, Pallarols claims, have provided sufficient resources to help these affected businesses get by, while Madrid is the only region in Spain not to have provided any financial aid to the sector. 

However, it is not necessarily quantities of aid that interests Pallarols most regarding this topic, but rather the fact that “we’ve seen other countries that have completely closed bars and restaurants for months have similar spikes in the pandemic like Catalonia and Spain, showing there is no causal relationship between the evolution of the pandemic and having bars and restaurants open.” 

Catalonia and Madrid have taken very different approaches toward managing the pandemic when the autonomous regions across Spain were given much more responsibility after the first wave had passed and after the first state of alarm ended last summer. 

Statistics reported by Spanish governmental bodies show no period of excess deaths in Catalonia between late December and late March, when stricter measures were in force. In Madrid on the other hand, the same report shows excess deaths of over 20% between early January and early March, with a slight drop to over 17% in April. 

Stats in medical centres reflect similar: hospital bed occupation due to the coronavirus was slightly more than twice that in Madrid (17%) compared to Catalonia (8%) in late April, while ICU occupancy was at 45% in the Spanish capital and 38% in Catalonia. 

The Catalan secretary general for public health, Josep Maria Argimon, believes that had Catalonia managed the pandemic in the same way as Madrid, there would have been a further 6,000 deaths. 

"Insignificant" economic help

Last October, the Catalan government announced financial support of €40 million for the industry, as well as offering extraordinary loans to help meet immediate needs such as paying the rent on their properties. For the restaurants association general director, this aid is “irrelevant” as it “doesn’t compensate even a little bit” for the damage done for having to shut completely. 

PIMEC, Catalonia’s association for small-and-medium-sized enterprises, criticized this amount of aid by saying it represents just 5% of losses incurred. Around 90% of the bars and restaurants in Barcelona are independently run, and in many cases are small family businesses. 

“The authorities haven’t given aid, and what aid they have given has been insignificant, late, and done poorly,” Pallarols said. The loans too, added with measures such as postponements of paying taxes, only serve to kick the can further down the road and put businesses in more and more debt, making life more difficult in the future, the association official says. 

He also rallied against the temporary layoff scheme brought in by the Spanish government at the beginning of the crisis. The ERTO scheme sees the administration cover a portion of employees’ wages while the company is forced to close during this exceptional period. 

Pallarols says the first wave of this plan was necessary, welcome, and important, but argues the next wave after the most severe home-confinement restrictions passed and the country began to open up gradually hurt his industry, with payments lower than costs of social security. 

Last summer, when the country began to take its first steps out of one of the world’s tightest lockdowns during the first wave of the pandemic, there was a strong emphasis on outdoor dining and seating in this industry, and many local councils allowed for businesses to open extra terrace space, and in some cases put tables and chairs out in front of their building where there was no terrace seating at all previously. 

This was celebrated, but also came with a price: despite a discount in terrace taxes, some restaurants even say they ended up paying more in taxes, given the extra spacing they were allowed. Tables and chairs must also be spaced further apart, meaning that extra space available does not necessarily equate to extra seats and more customers. 

"Speculative process"

Times of crisis for some can also mean times of opportunity for others. With many bars and restaurants going out of business, there has been a surplus of locales available to rent or buy, giving groups such as multinationals, chains, and investment funds the opportunity to take advantage of lowering prices. 

“What we’re seeing is a speculative process,” Pallarols says, adding that he doesn’t see this as such a terrible thing, as he values seeing any business open, providing jobs, and driving the economy forward above seeing a commercial space vacant and unused. 

However, he admits that this process could lead to a “loss of personality and of gastronomic offering.” Pallarols believes that Catalonia’s “magnificent” cuisine is one of its finest selling points to tourists wishing to come to Barcelona and elsewhere and spend money. This risk of losing out on its unique personality, tastes, and gastronomy is one that should “worry us all,” he says. 

L’Àvia was much more than just a place for people to eat and drink, it was a cultural and arts hub deeply rooted in the community of the Raval neighbourhood. Pérez Ruiz says that a month before his restaurant closed down, on a Sunday, they did “a 12-hour feminist poetry jam.”

The bookseller is left with no doubts on the issue: “Old businesses are part of Catalan culture. What’s not part of it are fast food chains run by multinational corporations taking over everything.”