The Catalan Government supports creating ‘hispanobonds’, Autonomy bonds with a Spanish Government guarantee

Barcelona (ACN).- The Spanish Minister for the Economy, Luís de Guindos, announced on Tuesday in Barcelona the creation of the so-called ‘hispanobonds’, common bonds issued by the Autonomous Communities and backed by the Spanish Treasury. The President of the Catalan Government, Artur Mas, met on the same day with de Guindos and told him he supported the initiative. Furthermore, the Catalan Finance Minister, Andreu Mas-Colell, said he believes that the initiative “goes in the right direction”. In fact, Mas-Colell was the first person to officially propose the measure several weeks ago. In addition, the Catalan Finance Minister stressed that there is already a defined plan to solve the cash problems of the different public powers. Mas-Colell was satisfied with the “reasonable evolution” of the cash problems of the different public powers in Spain.

Despite announcing the creation of the so-called ‘hispanobonds’, Luís de Guindos did not explain the details of the plan. However, the Spanish Minister said they should be created before summer, probably before June, since it is quite urgent to find a solution to the high interest rates the Autonomous Communities have to pay when they turn towards the financial markets for cash, as any other government with fiscal autonomy does. In the last number of months, the Autonomous Communities have seen rating agencies downgrade their debt. Following this trend, they have seen they had to pay two, three or four more percentage points of interest rates than the Spanish Government for the bonds they were issuing. The ‘hispanobonds’ would partially correct this trend, since there will be a common bond for all the Autonomies and will be backed by the Spanish Treasury, which will act as the guarantee. The body that will manage the issuing of these ‘hispanobonds’ will “absorb the capacity to issue bonds of the public powers” participating in such emissions, explained the Spanish Minister.