economy

The Catalan Government has presented a new strategy to boost important industries such as chemical, energy and resources, design, sustainable mobility or healthcare. Those sectors will have, by September, a team of experts that will include members of Government and the most important companies, and will prepare strategic plans to help them develop further. The Catalan President, Artur Mas, said on Friday that Catalonia needs its industries, and urged businesspeople to work together with him in order to improve the state of the economy.

At the end of June 2014, the unemployment lists in Catalonia registered 570,214 people, 22,090 fewer than in May, and 47,074 fewer than in June of last year, according to the Spanish Ministry of Employment and Social Security. These figures represent a decrease of 3.73% in the number of unemployed between May and June, and even more significantly, a decrease of 7.63% between June 2013 and June 2014. This reduction of 47,074 persons in annual terms constitutes the greatest fall in unemployment registered in Catalonia since 1998, 16 years ago. Catalonia has experienced the largest decreases in the numbers of people unemployed of any autonomous community in Spain.

An agreement between the Centre-Right pro-Catalan State Coalition (CiU) – which runs Barcelona's municipal government in minority – and the People's Party (PP) will allow shops located in tourist areas of the Catalan capital to be open on Sundays during the summer season, from 10am to 6pm. Shops in Catalonia are normally closed on Sundays, with few exceptions for the Christmas or sales seasons. However, shops in small tourist towns are allowed greater flexibility during holidays and can open on Sundays. The case of Barcelona is quite unusual, since it is the largest tourist destination in Catalonia but it is also a big city with a dense network of small and neighbourhood shops. These small shops could be damaged if they have to open longer hours (with the increase of financial and personal costs associated) in order to compete with multinationals.

On Friday, the Spanish Government reacted to the publication by the Catalan Executive of the so-called "fiscal balances" for 2011, which calculate how much money citizens from Catalonia paid in taxes to the Spanish Government and how much they received back in terms of services, grants and investments. After the weekly cabinet meeting, the Spanish Deputy Prime Minister, Soraya Sáenz de Santamaría, stated that the Catalan Government is "making the calculations" that "interest for a political message". "All the elements have to be put on the table and with maximum transparency", she added. The Spanish Executive only published those figures once, in 2008 with data from 2005, not respecting the successive requests from Parliament and transparency standards. The Catalan Government has been calculating these figures for the last years, following the advice of independent university experts. Between 1986 and 2011, Catalan gave away an average of 8% of Catalonia's GDP each year, an amount representing €16 billion per year in today’s money.

The so-called Consumer Price Index (IPC) – which represents the inflation rate – in May stood at 0.5% in Catalonia in annual terms. In April, it stood at 0.7% according to figures published on Friday by the Spanish Institute of Statistics (INE). Across the whole of Spain, inflation increased by 0.2% in May, while in April a 0.4% inflation rate was recorded, the IPC data confirms.  Core inflation – which does not take into account the prices of energy and unprocessed food –  fell from 0.3% in April to 0.0% in May. The product groups that had a greater impact on May's IPC were food and non-alcoholic beverages (-0.8%), recreation and culture (-1.1%) and hotels, cafes and restaurants (+0.5%).

The Catalan Government issued on Thursday its own calculation of the so-called fiscal balances with the latest data available, which is from 2011. In that year, Catalans funded services and infrastructure in the rest of Spain for €15 billion, equivalent to 7.7% of Catalonia's GDP or €2,055 per citizen, using the monetary flow formula. Using the tax-benefit method, Catalonia contributed €11.1 billion, equivalent to 5.7% of its GDP. The two methods are "complementary", as the Catalan Finance Minister, Andreu Mas-Colell stated, although the first one makes less assumptions and is closer to reality in times of economic crisis and high unemployment. "Catalonia is a net and generous contributor" to the whole of Spain, he said. In fact, the figures for 2011 confirm Catalonia's "sustained" negative "fiscal balance" for the 1986-2011 period, with an average 8.0% fiscal deficit. This has been for decades a very sensitive issue in Catalan and Spanish politics, and even more considering the self-determination debate.

The sale of homes in Catalonia rose 13.1% this April, compared with the same month last year, according to the Spanish Statistics Institute (INE).  April 2014 saw the sale of 3,724 properties in Catalonia, 3,334 of which were free (89.5%) and 390 protected (10.5%).  Of these transactions, 32% corresponded to newly-built flats and 68% were of existing homes.  Across Spain, sales have increased by 5.3% in annual terms, with a total of 24,968 transactions registered. Thus, Catalonia sits comfortably above the Spanish average, but was surpassed by eight other Autonomous Communities, including the Basque Country, Cantabria and the Balearic Islands, where purchases increased by 48.8%, 41 6% and 28.5%, respectively.

In May 2014 the Catalan airfield recorded 3,397,097 passengers, a 5.5% increase on May last year. Madrid's international airport exceeded this number with a total 3,544,649 passengers, 147,562 more than its Catalan rival, with a 4.1% growth. Madrid's airport has recovered from the 10% losses registered over the last 2 years, but it grows much slower than its Catalan competitor. One of the reasons for Barcelona's growth is the notable increase of intercontinental flyers. In the first 5 months of 2014, 13,517,143 people flew from Barcelona, a 7% increase from the same period in 2013. The equivalent figure from Madrid is 15,808,392, representing a 2.8% increase. Meanwhile, the number of passengers arriving at Girona- Costa Brava Airport, continues to decline, with a fall of 20% since 2013.

Throughout this week the Fira de Barcelona's Montjuic exhibition venue in the Catalan capital is transformed into a business fair for start-ups and entrepreneurs. The BizBarcelona event takes place on Wednesday the 4^th and Thursday the 5^th of June and is the second edition of this innovative business fair. The event serves several purposes and contains as many as six different areas including e-commerce, the financial markets, exports, franchises, business consulting as well as cooperation and networking. The event offers various opportunities for established and future entrepreneurs. BizBarcelona is a welcome initiative. First quarter financial reports revealed a decrease in bankruptcy proceedings, and with a high unemployment rate in Catalonia and Spain it is hoped that these new companies can create jobs.

Registered unemployment in Catalonia has dropped to 592,304 people at the end of May 2014: the first time the figure has fallen below the 600,000 mark since August 2011. According to figures released by the Spanish Ministry of Employment and Social Security, between May 2013 and May 2014, registered unemployment dropped by 7.76 %, a reduction of 49,862 people. In only one month, unemployment decreased by 19,518 people from April to May, a 3.19 % drop. This has been the greatest monthly decrease recorded in May for 18 years. Furthermore, Catalonia has also experienced the greatest fall in unemployment of any Autonomous Community in Spain this last May, followed by the Region of Madrid.

The Catalan industrial sector received €1.365 billion of direct foreign investment in 2013, the highest amount since 2005, according to Barcelona’s Chamber of Commerce. This represents 52% of the total foreign investment in Spain’s industrial sector in 2013, while Catalonia represents around 19% of Spanish GDP. Across all sectors Catalonia received a total of €3.51 billion of foreign investment last year, 31% more than in 2012. In addition, the President of the Chamber, Miquel Valls, emphasized that foreign investment in Catalonia went mostly to the industrial sector and advanced services, while in the rest of Spain it mostly went to the recreational and real estate sectors. According to Valls, this indicates that international investors have identified Catalonia with “a new production model”, while this has not happened in the rest of Spain.

Exports from companies based in Catalonia reached €14.69 billion during the first 3 months of 2014, a 4.1% increase on the same period of 2013. Catalan exports stagnated in 2013 on 2012 figures, with 0.1% growth, after a few years of significant increase. The figures from the first quarter of 2014 point towards a recovery of export growth, mostly thanks to the month of March, when exports grew by 7.8% compared to the same month of 2013. In the whole of Spain, exports increased by 3.2% in the first quarter and Catalonia represented 25.2% of total Spanish exports. The chemical industry accounted for 27.6% of Catalan exports, followed by capital goods and the car industry. 65.4% of Catalonia’s exports went to European Union markets, while exports to Asia accounted for 9%.

Sales of residential real state in Catalonia increased by 42.8% in March compared to the same month in 2013, according to data released on Tuesday by the Spanish Statistics Institute (INE). In the whole of Spain, housing sales grew by 22.8% in the same period, with 27,047 transactions. In Catalonia, 3,944 residential units were sold: 1,267 were newly-built houses (32.12%) while the remaining 2,677 were second-hand (67.88%). 3,567 (90.44%) were open market while the remaining 377 (9.56%) were subsidised housing units. Catalonia is the Autonomous Community with the second highest percentage increase in sales, coming after the Balearic Islands, which registered 71% increase.

The Catalan economy grew by 0.4% in the first quarter of 2014, which means that GDP has been increasing for the last 4 consecutive quarters, leaving recession far behind, according to an early estimate published on Monday by Catalonia’s Statistics Institute (Idescat) and the Catalan Ministry of the Economy and Knowledge. Furthermore, between March 2013 and March 2014, Catalonia’s economy grew by 0.8%. In the second quarter of 2013 it registered a quarterly growth of 0.1%; in the third it also posted a 0.1% quarterly growth; between October and December, it increased by 0,2%; and now, between January and March, it grew by 0.4%. The services sector has been the main engine behind this positive trend; in the last 12 months it grew by 1.4%.

This weekend the Formula 1 World Championship comes to Catalonia once again thanks to a long tradition which blends the motor industry and competition. Catalonia has several industries related to cars and motorbikes. Aside from SEAT, Nissan, Honda and Rieju are important factories that supply components worldwide. Catalonia plays host to a packed motor sports calendar. The Formula 1 Grand Prix, the GP Motorbike Grand Prix, the World Rally Championship all take place in Catalonia among other endurance series, classic races and indoor or outdoor motorbikes championships. Moreover, Catalan drivers are competing in a lot of international categories. For instance, last year the three Motorcycle World Champions – Marc Márquez, Pol Espargaró and Maverick Viñales - were all Catalans.