economy

The Catalan vice president and Catalan Minister for Economy and Tax Office, Oriol Junqueras, stated that the Government “won’t make any cuts”and emphasised that Catalonia already allocates 70% of its budget to social policies and that 90% of the Government’s expenses are final. Junqueras’ statements come after the Spanish Finance Minister, Cristóbal Montoro, sent a letter to several Autonomous Communities in Spain urging them to “comply with the budget stability”. Montoro also nuanced that Catalonia’s deficit target in 2015, which was 2.7%, surpassed the maximum deficit established by the Spanish government by 0.7%. “If the Spanish Ministry wants to make cuts or shut down hospitals, it will have to come and do it itself”, warned Junqueras. He also emphasised that “the Spanish Finance Ministry has imposed so many cuts in the last years that any additional ones are simply inapplicable”.

The Zurich Insurance group will establish its new global data centre in Barcelona, as was divulged by the company CEO Vincente Cancio last Thursday. The opening of the global data centre, which is a two-year project, will establish 200 jobs. These positions will add to the existing 250 which the Zurich Group has already created in Barcelona. The company has over 2,000 employees and more than 130 years of presence in Spain.

There were 87,900 fewer jobseekers at the end of 2015 in comparison to the end of 2014, which represents the biggest annual drop since 2003, according to the latest Active Population Survey (EPA). This represents the 10^th consecutive month in which the rate of unemployment has decreased in Catalonia in comparison to 2014. The unemployment rate in Catalonia at the end of 2015 was 17.7%, 2 points lower than it was on the 31^st of December 2014. In the whole of Spain, there were 678,000 less unemployed at the end of 2015, the biggest drop in absolute numbers. In percentage terms, the unemployment rate was 20.9%, still higher than Catalonia’s.

Barcelona’s Chamber of Commerce estimates that the Catalan economy grew by 3.2% in 2015, which is more than double the figure for 2014 and marks a return to pre-crisis levels, when the GDP increased by 1.5%. To “keep on advancing on the path of economic recovery” and to respond to Catalonia’s push for independence and “guarantee the territorial stability”, the president of Barcelona’s Chamber of Commerce, Miquel Valls, called for “the widest consensus possible” amongst the main parties with representation in the Spanish Parliament. He also emphasised the “fundamental” need to keep the relationship and the compromises established with the EU, as the 40-billion-euros rescue package for the banks in Spain led to the recovery of the risk premium and brought back the trust in the Spanish market.

The members of the new Catalan executive took office this Thursday, more than three months after the 27th of September Catalan Elections resulted in the victory of pro-independence forces. Catalan President, Carles Puigdemont, called them to be “aware” of the citizens’ assignment “without renouncing anything”. ERC’s leader Oriol Junqueras has been designed to assume the Vice presidency and led the Department of Economy and Tax Office, one of the key areas of the new executive. Another novelty is the creation of the department for Foreign Affairs, which will be led by former MEP and ‘Junts Pel Sí’s top member, Raül Romeva.

The results of the 20-D Spanish Elections and the negotiations to form a new government in Catalonia, which are still ongoing, are worrying the business world. During the celebration of the eighth edition of the Carles Ferrer Salat Awards, which recognise remarkable initiatives in the business world, Foment del Treball’s president Joaquim Gay de Montellà highlighted the difficulties in forming “stable and strong” governments. “Everything would be easier if it would have been possible to start a dialogue process” he stated in a speech before current Catalan President Artur Mas and the Spanish Minister for Foreign Affairs, José Manuel García Margallo. Gay de Montellà also announced that “the risk of recession has moved away and the economy is running”.

Employers’ association CECOT's president, Antoni Abad, warned of the economic "instability" that political "stagnation" may cause and expressed his "wish" for Catalonia to constitute a new government "as soon as possible". "We can't continue like this" he stated "98% of CECOT associates refuse the status quo". Abad made these statements this Wednesday at a meeting with Parliament's President, Carme Forcadell, whom in turn assured that she is "hopeful" regarding pro-independence forces 'Junts Pel Sí' and CUP’s negotiations. Abad also asked the government to "facilitate" growth of the Catalan business sector and improve its funding system. CECOT's president also confirmed to Forcadell that Catalonia's economy is recovering in terms of employment and internationalisation capability.

The Catalan project 'Guifi.net', based on an open Internet, was amongst the five winners at the first edition of the European Broadband Awards. It was awarded best project in the category on innovative model of financing, business and investment. 'Guifi.net' was founded in 2004 and aimed to connect those rural areas in Catalonia and in the rest of the Iberian Peninsula which had difficulties getting a good Internet service. Now, it is present in more than 30,000 homes. Its president, Ramon Roca, regarded the prize as “a recognition of more than 12 years of hard work”. A total of 48 projects from 17 Member States took part in the European Broadband Award’s competition, an initiative aiming to identify the five best projects of high-speed broadband networks – the so-called Next Generation Networks (NGN) delivering at least 30 Mbps in urban, suburban and rural areas.

The number of jobless people in Catalonia at the end of the third quarter stood at 659,600, which means 66,500 less than in the same period last year. The 17.49% unemployment rate is the lowest in the last five years, according to the Active Population Survey (EPA) published this Thursday by the Spanish Institute of Statistics (INE). Catalonia is the Autonomous Community which led job creation in Spain:between July and September, 35,800 jobs were created, mainly in the service sector, due to seasonal contracts. In Spain as a whole, unemployment fell by nearly 300,000 people and 182,000 new jobs were created. The overall number of jobless people in Spain now stands at 4.8 million, a figure that hasn't been registered in the last four years and is below the 5 million  psychological barrier. 

The President of the European Commission, Jean-Claude Juncker assured that he is for a "unified Europe" and against facing "more divisions" in Europe. "We won't accept divisions in Europe anymore. We already suffered a lot during the Second World War, after the war and during the Cold War". Juncker made these statements this morning at an event in Madrid, just before attending the European People's Party meeting that will be held in the Spanish capital and that is set to pass a declaration in defence of the unity of the EU's Member States. Juncker emphasised that "Spain is not a compilation of divisions and compartments, but a coherent set" and took the chance to support Spanish Prime Minister Mariano Rajoy's administration as head of the Spanish executive. 

The Bank of Spain Govenror, Luis Maria Linde, corrected his previous statement and admitted that “freezing bank accounts” if Catalonia becomes an independent country is a very “improbable, almost impossible” situation. Linde’s clarification comes after his statements last week assuring that Catalonia would face a ‘corralito’ in the event of independence. He added this Wednesday that he wasn’t “that worried” about this possibility nor is “anybody else in Europe”. Following Linde’s warning, a group of six prestigious economists asked for the Governor’s resignation and recalled that Linde’s task should be “promoting financial stability” rather than “influencing thevoters’ decisions”.

During the second trimester of 2015, foreign investment in Catalonia grew by some 422%, reaching €1,302 million. “We have grown more than ever and we have become a point of reference in Europe” stated Catalan Minister for Business and Employment, Felip Puig. “These results show the world how diversified and solid our economy is” he added. During the first trimester this year, Catalonia was the leading region in Continental Western Europe in terms of investment, both in total amount of investments attracted and in the amount of jobs generated. This growth is much higher than the Spanish average; foreign investment in Spain in the second trimester of 2015 was only 73% higher than that recorded during the same period last year. 

Catalan exports grew 7.4% in July and exceeded the €6,000 million barrier for the first time. The total figure was €6,086.30 million and the 4 regions in Catalonia (Barcelona, Girona, Tarragona and Lleida), all obtained positive results, according to the Spanish Ministry of Economy and Competitiveness. Sales increased in the leading export sectors, which involve chemical, automotive and capital goods, with the automotive sector recording the highest increase, up 18.2% compared to last July. Since the beginning of this year, every month has recorded the best performance in export volume and if this trend keeps up, 2015 will be a  record year. In Spain as a whole, exports in July were worth 148,000 million euros, the best month ever recorded.

The Spanish Bank Association (AEB in Spanish) and the Spanish Confederation of Saving Banks (CECA in Spanish) warned about the “risks” of Catalonia’s independence. In an official announcement made this Friday, both associations assured that all banks with a presence in Catalonia “would face severe problems of judicial insecurity” in the event of a Unilateral Declaration of Independence after the 27-S elections. They outlined that “any political decision which would imply breaking the rules in force” would result in “exclusion from the EU and the Eurozone” for Catalonia. The Catalan Finance Minister, Andreu Mas-Colell, described the Spanish government as “being irresponsible” for pushing the banking sector to be against the independence of Catalonia. He regretted that such “a delicate sector” was used as an “artillery weapon”. 

The Catalan bank Sabadell has completed the process of compulsory acquisition of all TSB Banking Group (TSB) shares, thereby taking ownership of 100% of this British entity’s share capital. The move completes the takeover started last spring, when TSB accepted the 1.7bn-pound offer made by Banc Sabadell. Through buying TSB, Banc Sabadell has expanded its international presence, with its percentage of foreign assets growing from 5% to 22%. TSB has 631 branches, 4.6 million customers and 8,600 employees in the United Kingdom.