Mas explains Catalonia’s austerity measures to Liberal leaders in London

London (ACN).- The President of the Catalan Government, Artur Mas, participated in a summit of European Liberal leaders in London on Monday. As Catalan President, Mas was the only leader of a nation without a state present at the summit, which was organised by the UK Deputy Prime Minister, Nick Clegg. Mas spoke of the Catalan Government’s austerity measures and gave a first hand account of Catalonia’s reality, which more than often is portrayed incorrectly and other European countries get a “very distorted image”, sent by “interested parties”. “European leaders must have all the information” in order to have an accurate picture of the situation in Spain and have their own opinion, he said. “The idea is being sold that the problem is the Autonomies and Catalonia”; this is “a lie”, Mas said. “We are doing our homework, we are leading the adjustment and austerity processes [in Spain], but European leaders must also understand that Catalonia is in a very delicate situation from a financial and resource point of view because it finds itself in a very atypical relationship with the Spanish State”, explained Mas. The Catalan President stated that Catalonia has an excessive and “continuous fiscal drainage” from the Spanish State, which “is unprecedented in Europe”. He insisted on the importance of understanding Catalonia’s economic and political reality as it “holds systemic weight within the European Union economy”. Mas added that Catalonia’s GDP is the size of Finland’s or Portugal’s, and has an export level similar to that of Denmark.

Prior to the summit, the Catalan President met bilaterally with UK’s Deputy Prime Minister, Nick Clegg. Furthermore, Mas also had a meeting with the Prime Minister of the Netherlands, Mark Rütte; the European Commissioner for Economic and Financial Affairs, Olli Rehn; and the European Commissioner for Transport, Siim Kallas, among others. The Catalan President criticised the Spanish Government’s recent decision to increase the Income Tax levels, which place Catalonia among the territories in the world with the highest Income Tax levels (only behind Aruba and Sweden). Artur Mas pointed out that this tax increase goes against the electoral programme of the People’s Party (PP) and the announcements made by the new Spanish Prime Minister Mariano Rajoy, at his inauguration speech just three weeks ago.

Catalonia is “doing its homework” and “leads the adjustment and austerity processes”

The President of the Catalan Government, Artur Mas, travelled to London to participate in a summit of European Liberal leaders on Monday. He met with the UK’s Deputy Prime Minister, Nick Clegg; Prime Minister of the Netherlands, Mark Rütte; the European Commissioner for Economic and Financial Affairs, Olli Rehn; the European Commissioner for Transport, Siim Kallas, among others. The Catalan President explained the efforts Catalonia is making to reduce public spending and meet the public deficit objectives. He explained the austerity measures the government he chairs has put in place, such as the 10% public spending cuts in 2011. In addition, he explained that many Catalan citizens are backing the budget cuts as they voted for Mas’ party in the last elections. “We are doing our homework, we are leading the adjustment and austerity processes [in Spain], but European leaders must also understand that Catalonia is in a very delicate situation from a financial and resource point of view because it finds itself in a very atypical relationship with the Spanish State”

Spain’s “continuous fiscal drainage” of Catalonia

In fact, Mas wanted the other European leaders to understand “the delicate situation” Catalonia finds itself in, “because it holds a non balanced relationship” with the rest of Spain, which turns into “a continuous fiscal drainage” of Catalonia’s resources. It “is unprecedented in Europe”. According to studies from the Spanish Ministry for Economics, Catalonia gives each year between 6% and 9% of its GDP to the rest of Spain for inter-regional solidarity; the difference depends on the calculation formula. Other studies, carried out in Catalonia, have shown that the figure could reach 10% or even 12%. Taking the Spanish Government’s data and considering the weight of the Catalan economy, which is the size of Portugal’s or Finland’s and exports as much as Denmark’s, the “fiscal drainage” –also called “fiscal deficit”- represents between €12 billion and €18 billion per year. In 2011, the Catalan Government will have a €5.6 billion budget deficit, representing 2.66% of Catalonia’s GDP. The majority of Catalans support inter-regional solidarity. According to recent opinion polls the vast majority of Catalans (76%) believe that the Spanish Government takes too much money away from Catalonia and would like the “fiscal deficit” to be significantly reduced. If it were reduced by half or even by just a third, the Catalan Government’s budget might not have a deficit.

Mas insisted that this “fiscal drainage” creates “enormous difficulties” for Catalonia. The President of the Catalan Government is aware that London is not the place to claim for a new economic agreement with Spain, but “wanted European leaders to be aware” and “understand” Catalonia’s situation.

“Interested parties” blame “the Autonomies and Catalonia” for Spain’s problems

With his trip to London, the Catalan President wanted to “counterweight” the “images with distortions” about Catalonia that the Spanish nationalists have sent abroad. “We need to be understood, because otherwise the picture of the situation is distorted”, Mas stated. “What comes from the ‘Madrid bubble’ is always very unidirectional, it only goes in one direction”, he criticised. Therefore, the Catalan President said he wanted the European leaders “to have all the information” so they could have their own opinion about Spain’s situation. “They are being sold the idea that the problem is the Autonomies and Catalonia”, he said; this idea is “a lie”, “biased”, and “it is being spread by interested parties”, he stated.

Yes to the Eurobonds, to the Intergovernmental Treaty and to the Euro-Mediterranean Railway Corridor

Artur Mas showed his support for the new European Union’s Intergovernmental Treaty agreed to save the Euro. In addition, he stated the European Central Bank should have its mission expanded and create Eurobonds, which should be joined by a Eurobond market. In addition, Artur Mas proposed the creation of “project bonds”, as a way to finance expensive infrastructure. One of the infrastructural projects that could be financed with this initiative would be the Euro-Mediterranean Railway Corridor, which was recently included as a EU Transport Priority. It would link Barcelona and Tarragona ports, as well as Catalonia’s main industrial and tourist areas, with Central and Northern Europe on international width standard railway for freight and high-speed trains.

The Catalan President criticises Rajoy’s tax increase and puts the focus on growth and job creation

Mas criticised the new Spanish Government’s decision to increase taxes such as Income Tax. “We acknowledge that the People Party and Mr. Rajoy have exactly done the contrary to what they said they would”, Mas said. However, he understands that the new Spanish Prime Minister has taken over “a very complicated economic situation”. “Without being in favour of the tax increase, we understand that the situation is very complicated” and that “the new Spanish Government has to send unequivocal signals that it will do whatever is needed to control the Spanish finances”. Nonetheless, the Catalan President insisted in the need to avoid limiting austerity measures but to foster economic growth and job creation. In fact, the final document of the Summit proposes a “European Jobs and Growth Plan”, “because problems cannot only be solved with austerity”. “ We need to help each other in trying to make policies that guarantee economic growth, which we are lacking at the moment”, the Catalan President claimed.

Mas leads the main Liberal party within Spain

The Catalan President, Artur Mas, is the Secretary General of the Catalan Liberal party ‘Convergència Democràtica de Catalunya’ (CDC) (‘Catalonia’s Democratic Convergence’), which is the main member of the two-party coalition ‘Convergència i Unió’ (CiU), which is the main Catalan nationalist political force. CiU runs the Catalan Government and is by far the main group within the Catalan Parliament, but it does not have an absolute majority. CDC is the main Liberal party in Spain. MEP, Ramon Tremosa, sits with the rest of the ALDE group at the European Parliament.