Catalonia Vote

Source: Le Monde, 28.09.2015
author: Mathilde Dangé
translation: doxa-louise

WHY CATALONIA IS SEEKING INDEPENDENCE

The regional election Sunday, in Catalonia, produced an important victory for the independence movement. This region in the South-East of Spain has never been a sovereign state, but has been experiencing in the last decades an ever-increasing independence sentiment.

Catalonian nationalism appeared but of late: a republican movement opposed to the monarchy, it led to the creation of a Catalonian government, La Generalitat, in 1932. Stifled under Franco, this Generalitat is re-established in 1977 and gains the approval in 2005 by the Catalonian parliament for a projected autonomy.

Nationalist sentiment yet remains largely that of a minority until 2010. In that year, a text enlarging the autonomy of the region and recognizing the Catalonian 'nation' is rejected by the Constitutional Tribunal, in Madrid. In response, one million people demonstrated in Barcelona, an important showing, in a region that holds a population of 7.5 million. Since then, nationalism has intensified and the national holiday, the Diada again this year brought out more than one million people --even though these numbers are questioned by Madrid.

Why is this region demanding independence? Does it have the means for it?

What is the importance of Catalonia within Spain?

It is one of the most powerful and rich regions of Spain. With 16% of the population, Catalonia produces 20% of the wealth of the country. One quarter of Spanish exports left from Catalonia in 2014.

Taking in Barcelona, Catalonia possesses one of the largest commercial ports of the Mediterranean, four regional airports, a competitive pharmaceutical industry, and serves as home to large multinationals, such as the textile giant Mango. The unemployment rate, certainly high, stays lower than the national average: it was at the second trimester 19.1% of the active population, as opposed to 22.4% at the national level.

At the political and administrative level the region has, as is the case with other 'autonomous communities' (Andalusia, Canary Islands, Galicia, etc), its own parliament and government, looking after notably health, education and social services. It has as well its own police.

In terms of cultural roots, Catalonia also has its own language, Catalan, used more than Spanish (Castilian), its hymn, Els Segadors (the reapers) and its flag with red and gold stripes.

What is the independence movement asking for?

Deeply indebted, to the extent of one third of GDP, the region puts forward that it would not be running a deficit (the public deficit being 2% in 2013) if the Spanish redistribution regimen, where rich provinces give to the poor, worked more in their favour.

According to calculations from 2011 done by Generalitat, the difference between what the region is giving to Madrid through taxes and what it receives from the State is of the order of 8.5% of Catalonian GDP. A contribution refuted by the government, which advances a number less by one-half (4.3 % of GDP of the region).

Today, the region administers roughly one-half of taxes, the central authority raising the other half. What the nationalist forces want, is an adaptation of the system currently used in the Basque region: administering all taxation by creating a kind of regional unitary system and handing over amounts to Madrid as a function of services rendered by the State to Catalonia, as well as a contribution to territorial solidarity (with the less well-off regions).

Other than the fiscal question, the independence movement has cultural demands: they are against a law passed in 2012 that forced the use of Castilian in schools -- the minister of Education at the time, José Ignacio Wert, calling even to 'assimilate to Spanish' young Catalonians. A declaration which stirred bad memories to those who had known the taking of the region by Franco's forces during the Civil War and the suppression of Catalonian identity.

Why this might be complicated

Within the context of the political process, there are many obstacles on the road to Catalonia's independence: the declaration of sovereignty by Catalonia was judged unconstitutional. It goes against article 2 of the constitution (Unity of the nation and right to autonomy) which recognizes a right to autonomy for the regions but not their independence, according to the principle of the indissoluble unity of the nation.

The Constitutional Tribunal yet recognized that Catalonians had a 'right to decide' according to their 'political ideals', but won't be able to exercise it until the constitution has been revised. And this complex process needs a majority in each of the parliamentary bodies, which the independence movement does not have. The project for self-determination of Catalonia is thus for the time being illegal and unconstitutional but is still the policy pursued by Artur Mas, the president (independence movement) of the region.

Further, as is the case with Scotland, it would be difficult to say if an independent Catalonia could be part of Europe. Brussels has long put forward the notion that a region heretofore part of a member State of the European Union would automatically leave the block made up of 28 countries."A newly independent region, by the very fact of its independence, would become a country other with respect to the EU and could then become a candidate to become part of the Union", explained a spokesperson for the Brussels executive, Margaritis Schinas last week.

Lastly, a non-trivial question: where would Barça play? The champion of Spain and all other Catalonian clubs would be excluded from the Liga Espagnole in case of secession of the region.

Would secession be favourable to the region?

Natixis Bank looked at this question in an analysis published a year ago, and gives an estimate to the effect that Barcelona stands to loose a great deal, enumerating:

"Loss of its exports with application of the common customs charges and the adding on of transaction costs, risk of seeing enterprises with seats in Barcelona relocate to have access to the common market, reduction in the amounts of direct investments from abroad ( at 80% those of European entities)"

At the national level, it would be a grave risk to find itself against a boycott from the central government: half of Catalonian commerce is with the rest of Spain. The government of Catalonia has for its part published a memo on 'Commercial Relations between Catalonia and Spain', driven by less pessimistic hypotheses and concludes to an impact of only 2% on the local GDP due to a loss of exports from Catalonia to Spain.

Natixis also mentions that the question of keeping the Euro as the national currency is unresolved, which adds to the uncertainty as to the viability of a new Catalonian State. Moreover, the region is as always financially fragile: it cannot finance itself on markets and has as its sole bank Madrid.