spanish economy

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.

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.

In the first two months of 2014 exports by Catalan companies increased by 2.2% on the same period last year, according to figures released on Wednesday by the Spanish Ministry for the Economy and Competitiveness. In fact, Catalan companies were behind 25.3% of all exports from Spain. Spain's exports in January and February reached €37.76 billion, a 4% increase on figures from the same period last year. In addition, the amount reached in the first two months of 2014 represents an historical record. The main industries behind those numbers are food, drinks, and tobacco, as well as manufacturing and automation.  The main markets for Spanish products were the UK, Portugal, the United States and Germany.

In Catalonia, direct foreign investment – excluding the stock-exchange –grew by 31.5% year-on-year to reach €3.51 billion in 2013, as indicated by a report from the Spanish Ministry of Economy and Competitiveness. According to the Foreign Investments Registry, with such a figure, Catalonia achieved its second best year in history, only surpassed by the €4.82 billion received in 2010. Besides, Catalonia accounted for 22.2% of all foreign investments in Spain in 2013, which amounted to a total of €15.81 billion, meaning 8.8% more than the previous year. The region of Madrid was the leading Autonomous Community in Spain for foreign investment attraction, receiving €8.64 billion, which is it to say 54.6% of the total amount. However Madrid's sum also represents a 7.1% decrease on 2012 figures.

On Wednesday evening the main Catalan small- and medium-sized enterprises association, Pimec, organised a protest conference in which they accused the Spanish and Catalan Governments of politically and financially "discriminating" against them. With the slogan #diguemprou (#wesayenough) 1,400 owners of SMEs and self-employed workers protested against both Governments for not taking SMEs into account and only working for the interests of large corporations. The protest was explicitly backed by 220 guilds and associations, as well as by 9 professional associations and that of self-employed workers. The event issued a manifesto compiling a list of grievances, split into 7 different areas: entrepreneurship; loans and funding; taxation; labour market; energy; training and employment; and internationalisation.

Catalonia is the only Autonomous Community in Spain to have registered a decrease in wages, as it was also the only one to have public employees' Christmas payment – equivalent to a month’s salary – entirely eliminated in 2013, according to the latest Quarterly Labour Cost Survey issued by the Spanish Government. Hence, while Spanish wages have increased by 2.1% in 2013, the wages of Catalan employees have continued on a downward trend continued o, falling by 0.7% at the end of December 2013 compared to the last quarter of 2012. The average salary in Catalonia stood at €2,133 per month, returning to 2009 levels, when it had amounted to €2,119. Labour costs, which group the employee salary and social costs assumed by companies, have also fallen by 0.4% in annual terms in Catalonia whereas they were up by 2.1% in Spain.

The largest employer’s association in Catalonia, Foment del Treball, expects that the economic recovery in both Catalonia and the whole of Spain will not lead to a growth in employment and consumption until late 2014 or early 2015, as explained in the Report on the Economic Situation published on Thursday. The Director of Foment’s Economics and Taxation Department, Salvador Guillermo, said in a press conference that the economic recovery is being “consolidated”. Nevertheless, he added that ongoing structural reforms in the energy sector, public administration or the financial system should continue. According to Guillermo, the reduction of public deficit must be slowed down in order to avoid any negative impact on the economic recovery. 

The President of Barcelona Chamber of Commerce, Miquel Valls, stated on Thursday that the independence process was not affecting Catalonia’s economic recovery. During a press conference, Valls emphasised that such a statement was based on concrete “facts”. He stressed that Catalonia had tripled the amount of incoming foreign investment compared to the Spanish average, and that the Catalan economy had also registered better figures in enterprise creation and business confidence, employment and other indicators showing an economic recovery According to the report on conjecture and economic perspectives, the Catalan GDP grew by 0.7% during the fourth quarter of 2013, whereas the Spanish GDP dropped by 0.1%. Valls also recalled that the consultation vote on the political future of Catalonia would involve “citizens and not businesses”, thus responding to the employers who recently voiced their opposition to Catalonia’s independence.

The Catalan economy has continued on a positive trend during the fourth quarter of 2013, also speeding up the recovery process. According to data released on Friday by the Catalan Ministry of Economy and Knowledge alongside the Catalan Institute of Statistics (Idescat), Catalonia’s GDP grew by 0.4% in the fourth quarter of 2013, while the Spanish average stood at 0.3%. In the whole year, the Catalan GDP has decreased by 0.6 %, while in 2012 it dropped by 1.3%. The continued good results in exports due to the increasing external demand and the improvement of the domestic demand have driven the economy forward.

In annual terms, there were 27,946 less registered unemployed people in January 2014 than in January 2013, meaning a 4.22 % drop. Seven consecutive months of decreases in the registered unemployed figures had not been achieved since June 2007. Besides, in monthly terms, the latest figures also show a positive trend. Indeed, January is traditionally a month where unemployment increases, with the only drop recorded since 1997, the beginning of the series, dating back to January 1998. In January 2014, unemployment grew by 8,999 people compared to December 2013, the mildest increase registered in that month since 2007. Referring to these latest figures, the Catalan Deputy Minister for Employment stated that he was “moderately optimistic”.

The economic crisis and especially the recession starting in 2009 have contributed to the growing weight of the underground economy in Catalonia and in Spain, according to a study presented on Wednesday by the Spanish Ministry of Finance’s Union of Technicians (Gestha). This study is entitled ‘L’economia submergida passa factura. Avançament del frau a Espanya durant la crisi’ (Underground economy takes its toll. Growing fraud in Spain during the crisis) and is led by Jordi Sardà, a professor at Tarragona’s Universitat Rovira i Virgili (URV). It reveals that according to the latest figures (from 2012) the underground economy has absorbed 24.6% of Catalonia’s GDP, hiding €47.36 billion. In 2009 the weight of illegal activity amounted to 22.3 %, meaning that between 2009 and 2012 some €4.6 billion were hidden.

The Catalan business community is deeply annoyed with the Spanish Government for not publishing transparent data on Catalonia’s fiscal contribution to the rest of Spain and therefore not recognising the fiscal deficit. The Spanish Finance Minister, Cristóbal Montoro, was supposed to issue the so-called fiscal balances last December but their publication was inexplicably delayed. Last Friday, in late January, Montoro announced the fiscal balances would no longer be calculated and published in the present form; instead, he would publish in March the “regionalised public figures” stating the costs of public services per citizen because the fiscal balances were “incomplete and incoherent”. However, on Tuesday, the Minister recognised that they were “correct” but “wrongly used” to support Catalan independence claims.

Last year, Catalonia was the leading Autonomous Community in Spain for foreign tourism spending, which generated €14.02 billion, 13.4 % more than in 2012, according to the Tourist Expenditure Survey (EGATUR) of the Spanish Ministry of Industry, Energy and Tourism. The average spending per stay in Catalonia amounted to €903 per foreign visitor, 4.9% more than in 2012, while the daily spending was set at €120 per person, 1.4 % more than the previous year. Catalonia accounted for 23.7 % of foreign tourism spending in Spain, which reached €59.08 billion. Besides, tourism spending grew more in Catalonia than in any other Autonomous Communities in Spain and is well above the Spanish 9.6 % average increase over the previous year.

Catalonia ended 2013 with an unemployment rate of 22.26% and a total of 820,400 people unemployed, according to the Active Population Survey (EPA) for the fourth quarter. In late 2013 Catalonia registered 64,700 fewer unemployed people compared to the last quarter of 2012. At Spanish level, the unemployment rate was set at 26.03 %, with a total of 5,896,300 unemployed people. At the end of 2013, there were 69,100 fewer unemployed than in the last quarter of 2012. Furthermore, between September and December there were 8,400 fewer jobseekers in Spain. In the same 3-month period there were 20,100 fewer jobseekers in Catalonia. The Catalan Deputy Minister for Employment stated that these figures were “the best since the start of the crisis” since “for the first time, the number of employed has increased and the number of unemployed has decreased”.

In 2013, Catalonia was the first tourist destination in Spain. It received15.6 million foreign visitors, meaning 25.7 % of the total number of international tourists in Spain (one in four). The figure represents an 8% increase over the previous year. The Balearic Islands were in second place, welcoming over 11 million tourists (18.3%), a 7.2% increase. The Catalan Minister for Business and Employment, Felip Puig, stressed that tourist spending also increased significantly, generating €14.2 billion in 2013, that is to say 14% more than the previous year. At Spanish level, the number of foreign visitors reached a new record: Spain welcomed 60.6 million tourists in 2013, making it the third favourite travel destination in the world, behind France and the United States.