catalonia

Unemployment has fallen by 15,400 people in Catalonia during the second quarter according to the latest Labour Force Survey published this Friday by the National Statistics Institute. The overall totals indicate that 821,600 of the working population in Catalonia are unemployed at a rate of 20.95%, 130,700 more than a year ago. The state total shows an increase in unemployment in the second quarter, bringing Spain’s total to 5.7 million people without work, 24.6% of the working population. With nearly a quarter of the working population unemployed, the figures are higher than the historical record reached in 1994 during the last crisis.

The Minister for the Economy, Andreu Mas-Colell, warned the Spanish government that the Generalitat "will never accept political conditions" in exchange for capital from the Regional Liquidity Fund (FLA). He repeated the phrase three times after revealing that the Catalan government has accepted financing from the FLA and has so far employed “all available instruments of liquidity” but “only” those that are linked to exclusively economic conditions. The minister admitted that the Catalan government will welcome the FLA due to “the liquidity pressures” that the Generalitat is facing. The specific amount of funding has not been revealed but Mas-Colell assured that “it will be what is necessary.”

Catalonia has not asked for a rescue from Spain, said the spokesman of the Catalan government, Francesc Homs. At a press conference, Homs denied reports that Catalonia is seeking a full bail-out, but admitted the government is considering participating in the Regional Liquidity Fund. “This is a treasury mechanism”, said Homs, who added that by using the fund Catalonia would not have to meet “any new set of conditions”. When presenting the €18bn fund last week, the Spanish government said the aid will be only offered under “strict conditionality”.

The death toll of the devastating wildfires in the Alt Empordà region, in north-east Catalonia, has risen to four this Monday, after a 64 year-old Frenchman died in hospital from his burns. He suffered 80% burns to his body. A father and daughter died on Sunday after jumping off a cliff to escape the flames in Portbou. A third man died of a heart attack in the small town of Llers. Eight injured people were admitted in hospitals in Catalonia. Six of them are in a critical condition, according to the Health Department. In total, forty-seven people have been treated for injures during the fires, although only eight remain in hospital.

All inhabitants in Alt Empordà, North-East Catalonia, are told to stay at home as forest fire rages out of control. A man and his daughter were killed in Portbou after jumping off a cliff to escape the flames. A third person died of a heart attack. Main roads and train lines in the area, including connections to southern France, have been cut off. Strong winds of up to 90 km/h have fanned the blaze, which started in the town of La Jonquera, near the border with France. There are already 13.000 hectares affected.

A combination of Spain’s economic predictions and Valencia’s formal request to the central government for financial assistance shook the markets on Friday, despite the stringent the austerity measures passed this week and the approved deal to lend up to 100bn euros to the Spanish banking sector. The Spanish government expects an unemployment rate of 24.3% and a fall in GDP of -0.5% in 2013, expecting to be out recession by 2014 and 2015 with a GDP growth of +1.2% and 1.9% respectively. The Valencian Government has requested assistance from the Spanish Government, making it the first autonomous community to ask for emergency financing from the regional liquidity fund.

In the first half of 2012, more than 37,000 inhabitants have left Catalonia taking into account the balance between immigration and emigration. This figure represents half the state total, having lost 74,000 residents. These figures demonstrate that Catalonia is experiencing the highest emigration rate in Spain, which can be attributed to a number of factors including the growing tendency for graduates to seek employment abroad.

The Catalan President in a parliamentary session criticised what he considers to be “acts of disloyalty” by the Spanish government. He said it is unfair that regions have to assume most of the burden of Mariano Rajoy’s adjustment program and emphasised the fact that Madrid has yet to pay much of its debts to Catalonia. Mas accused Rajoy of “lacking respect” for the autonomous regions and said this could lead to a “break down of relations” between administrations.

The Catalan textile industry accounts for 34% of Spanish fashion exports. A new report by “The Brandery” shows that in 2011, Catalonia was a crucial factor in the success of Spain’s growing fashion industry and emphasises its continuing and growing importance on the international fashion stage. The report was shown at an event this weekend and provides an encouraging insight into Catalonia’s significance in the Spanish fashion sector.

The Catalan Government and the Guardia Civil release 500 kilograms of eels – ten times more than in a regular year – seized from traffickers that wanted to export them to Asia, where this species is extremely coveted and where approximately 1300 euros is paid per kilo, way above the average prices that are paid in Europe

The Catalan minister for the Economy, Andreu Mas-Colell, said in an interview that he will ask to speak directly to Brussels if Madrid decides to intervene in Catalonia’s finances. The minister is very disappointed with the results of a meeting between the 17 autonomous communities and the Spanish Minister Cristóbal Montoro. At the summit, Montoro announced a new cut in the regional deficit targets, from 1,1% to 0,5% for 2013 and from 1% to only 0,1% the year after. This could imply a new adjustment of about €650 million on top of the 1,500 million already announced by Catalan President Artur Mas only two months ago. The Catalan government spokesman, Francesc Homs, did not deny the possibility of new cuts in Catalonia in the near future. If they are confirmed, those would be the fourth round of spending cuts implemented in the country since Mas entered office in November 2010. Meanwhile, other autonomous communities still have to start to reduce spending.

Catalan companies sold more goods and services abroad than they did to the rest of Spain in 2011. 52.9% of all Catalonia’s external sales were made abroad, while 47.1% were made to the rest of Spain. In addition, it is the first time that Catalonia has registered a positive balance of trade.

A new poll by the Centre of Opinion Studies shows that, for the first time in history, Catalans prefer independence to any other political arrangement with Spain.

The President of the Catalan Government has organised a summit with all the parties at the Catalan Parliament to discuss a new fiscal scheme for Catalonia. According to official studies, Catalonia gives 8.5% of its GDP each year to pay for investments and services in the rest of Spain, an amount that represents more than €17 billion per year. Some parties state that the current model is unsustainable for Catalonia and represents a plundering of its finances. Others have a more moderate opinion. Nonetheless, all political parties in Catalonia now believe that this amount is excessive and that the fiscal scheme between Catalonia and the rest of Spain should be reviewed. However, they significantly disagree on the formula and the timing.

Using its absolute majority, the People’s Party (PP) has approved the Spanish Government’s budget for the current year refusing 3,100 amendments from the opposition. Only 3 minor amendments from the opposition parties have been accepted. The budget does not respect the current legislation, which obliges to guarantee a minimum investment percentage to be made in Catalonia in order to compensate for an historical lack of money being put into the Autonomous Community. According to Catalan law, approved by the Spanish Parliament, Catalonia should receive at least 18.66% of all the territorial investment made throughout Spain; however it only receives 11.04%.