Politics

According to a study by the Professional Association of Economists of Catalonia (Col·legi d’Economistes), an independent Catalonia would obtain a much better grade from rating agencies than it currently gets, taking into account its diversified economy and higher GDP per capita than the European average. Specifically, it would obtain an A+ rating, 7 levels higher than the current BB ‘junk bond’, using Standard&Poor’s classification. The study highlights that without the current fiscal deficit with the rest of Spain, the rating would be “at least” that of the Basque Country and would enable the Catalan Government to access the international financial markets. Catalan taxpayers pay much more to the Spanish Government than the amount they get back in terms of services and infrastructure; a fiscal deficit equivalent to between €13bn and €17.5bn per year.

Adam Price, the former Member of Westminster Parliament and Harvard University expert, believes it “would be very difficult” to argue that an independent Catalan state would not be prosperous. In fact, he thinks Catalonia “would have done better” without being part of Spain. Price is an acclaimed economist and political expert and the author of a report written for Harvard University on the economic potential of smaller countries. In the report Price examines how smaller European economies have a higher chance of gaining economic success than larger ones. Studying small European nations, Price believes, without a doubt, that an independent Catalonia would have huge potential in the long run. However, he also stresses that “transition cost” are another debate.

After confessing that his family had kept a fortune in Andorra without informing tax authorities for 34 years, the President of the Catalan Government between 1980 and 2003 and founder of the centre-right Catalan nationalist coalition CiU, Jordi Pujol, his wife Marta Ferrussola and 3 of their 7 children (Marta, Mireia and Pere) testified before the judge investigating the case. They are indicted for alleged fiscal fraud and money laundering. During more than 2 hours, Pujol (aged 84) answered the judge’s and the anti-corruption public prosecutor’s questions. He insisted that his father had left a hand-written letter with instructions about 140 million pesetas secretly left in Andorra in 1980 for his wife and children, but not him, coming from his “illegal” activities selling currencies during the dictatorship. However, the defence has not yet presented any supporting documents. Besides this, 3 of Pujol’s other sons are indicted for other fiscal fraud and corruption cases.

The current President of the Catalan Government and leader of the centre-right pro-Catalan State coalition CiU, Artur Mas, will have to testify as a witness before the Catalan Parliament’s committee investigating the alleged fiscal fraud and possible corruption committed by the former Catalan President and CiU’s leader until 2003, Jordi Pujol. Artur Mas is Pujol’s political heir and was the ‘number 2’ in his last cabinet. Pujol, who uninterruptedly chaired the Catalan Executive between 1980 and 2003, confessed last July that his family had kept a fortune in Andorra for the last 34 years without informing tax authorities. The confession shocked Catalan society, since the historical leader of the conservative Catalan nationalists was a crucial figure in the fight against Franco’s dictatorship, the transition to democracy and the recovery of Catalonia’s self-government. Now, Pujol, his wife and 6 of their 7 children are being investigated by the judiciary for alleged fiscal fraud and several corruption scandals. 

The governing centre-right pro-Catalan State coalition CiU and the left-wing Catalan independence party ERC have reached an agreement to approve the Catalan Government’s budget for the current year. After the President of the Catalan Government and CiU leader, Artur Mas, and the ERC’s President, Oriol Junqueras, reached an agreement on holding early elections on 27 September as a plebiscite on Catalonia’s independence, both parties reopened the budget talks. After 10 days of negotiations, they have reached a definitive agreement, which includes a €100 million fund that will bring more resources for social programmes. They have also agreed to stop paying some allowances to senior officials. Furthermore, they will add €10 million to the development of Catalonia’s own tax administration and they will also create the Agency of Social Protection, which is to manage Catalonia’s Social Security system.

Barcelona plays host this weekend to the 1^st Southern Europe Forum, under the slogan '#southrEUvolution'. Politicians from the European Alternative Left-wing parties and the leaders of the main social movements will meet in Catalonia to broaden political alliances. The main objective of the meeting is to create alternative policies for the south of Europe, different to the austerity measures promoted by the Troika. The forum has been promoted by the Catalan Green Socialist and post-Communist coalition ICV-EUiA, with the support of the Spanish United Left Party (IU) and the Greek Alternative Left Party Syriza. At the forum leading MEPs such as Pascal Durand, from the French Green Party and the European Green Party (EGP) co-president Monica Frassoni will also be present.  

The Constitutional Court has accepted to debate the Spanish Government's last appeal against the Catalan Executive's tax on bank deposits, which has to be paid by financial entities. Such a decision represents the automatic cancellation of the tax for an initial period of 5 months. Catalonia approved such a measure in December 2012 and two weeks later, the Spanish Government approved its own tax with a 0% rate, so it was 'de facto' cancelling the regional taxes. However, instead of compensating Catalonia for having cancelled the tax – as it is legally obliged to do – the Spanish Government refused to do so, since it argued that the tax had not entered into force yet and took the issue to the Constitutional Court. The Court initially accepted the Spanish Executive's appeal and the tax was temporarily suspended, but in May 2013 it was lifted. In July 2014, the Spanish Government modified the tax with a 0.03% rate and in December it presented a new appeal against the Catalan tax, which brought in some €680 million in 2014.

The Catalan Green Socialist and post-Communist coalition ICV-EUiA has presented the manifesto 'Catalonia with Tsipras' supporting Syriza, the Alternative Left Party that according to the polls could win the upcoming Greek General Election. More than 2,500 people have already signed the document through Change.org. The manifesto states that a clear win for the Alexis Tsipras party would be best for Europeans, in order to "initiate a necessary rebellion" in Southern Europe. The leaders of the main Catalan trade unions and some actors, writers and academics have expressed their support for the text. Barcelona will host a meeting focused on these elections on the 24^th of January.  

The Catalan Government is expecting to post a 2.2% deficit for the whole of 2014, corresponding to some €4.41 billion. However, the definitive figure will not be known until March. This is more than  double the 1% deficit target that the Spanish Government unilaterally imposed on the Catalan Executive. Over the last few years, the two governments have quarrelled about deficit targets, since the Spanish Executive is imposing much stricter objectives on the Autonomous Communities than those it allows itself, despite regional governments exclusively managing and funding the basic Welfare State services such as healthcare and education. For instance, for 2014, the Spanish Government only allowed the Autonomous Communities to only have 15% of the whole deficit allowed by the European Union to Spain’s entire public sector, despite managing some 35% of the country’s public funds and basic services.

The Catalan Parliament approved on Wednesday the Law on the Val d’Aran’s special status within Catalonia, recognising its “Occitan national reality” and its right to self-determination. This small Pyrenean valley, surrounded by high peaks and located in Catalonia’s north-western corner, is the last land where the Occitan language is widely spoken, although it is called Aranese there. The Val d’Aran County has had a certain degree of self-rule within Catalonia since 1990, further recognised with the Catalan Statute of Autonomy from 2006. In addition, since September 2010, Aranese is Catalonia’s third official language, being the preferred language in this county. The law approved this Wednesday develops and consolidates the Val d’Aran’s special regime, with its own powers of self-rule and structures. In order to enter into force, it will have to be approved through referendum by the less than 11,000 inhabitants of the valley.

The Catalan Government has formally requested €9.46 billion in loans from the Liquidity Fund for the Autonomous Communities (FLA), run by the Spanish Finance Ministry, to face debt payments and other obligations during 2015. This is the only way that the Spanish Government authorises the Catalan Executive to request liquidity as it has banned Catalonia’s access to financial markets to obtain additional funds, as many governments do when they issue bonds or ask for loans. Therefore, the FLA has become the Catalan Executive’s only bank and a source of funds that must be returned. However, for the first time this year, the Spanish Government will not make money on the FLA and has set a 0% interest rate, which will have a €300 million positive impact on the Catalan Executive’s budget.

The document will be sent to the United Nations, the European Parliament, the European Commission, the Council of Europe and the Organization for Security and Co-operation in Europe (OSCE). The Spanish Government “violates the Catalan people’s right to decide its own political future and bans the exercise of democracy through a referendum or an internationally standardised consultation vote”, reads the complaint, signed by 1,386,628 citizens and 3,703 elected representatives such as mayors and MPs. They complain about the “Spanish Government’s anti-democratic attitude”, which ignored an electoral mandate from 2012 to hold a legal and binding self-determination vote in Catalonia, among other facts. The signatures were collected during the symbolic vote on independence held on 9 November by the civil society organisations Catalan National Assembly (ANC) and Òmnium Cultural, as well as by the Association of Municipalities for Independence (AMI). 

Following the agreement reached last week between the President of the Catalan Government and leader of the governing centre-right pro-Catalan State coalition CiU, Artur Mas, and the President of the left-wing pro-independence party ERC, Oriol Junqueras, on calling early elections in September as a plebiscite on Catalonia’s independence from Spain, the Catalan Executive’s budget for 2015 is now closer to definitive approval. On Monday, the ERC MPs started to withdraw their full amendments to the different sections of the Catalan Government’s budget. Now, the ERC is asking the CiU and the Government to debate their specific amendments on precise programmes in order to have “a fairer budget” which is less regional and more that of a country in its “national transition”, they said.

The Spanish Deputy Prime Minister, Soraya Sáenz de Santamaría, strongly criticised the calling of early elections in Catalonia, announced by the President of the Catalan Government, Artur Mas, for 27 September as a ‘de facto’ plebiscite on independence. Sáenz de Santamaría stated that such a call shows Mas’ “failure” and his “incapacity” to run a government. She also said that the Catalan President is announcing elections 8 months in advance “to hide his ineffectiveness”. Besides this, the Spanish Deputy PM warned Catalan authorities that any measures adopted in the coming months that exceed Catalonia’s self-rule powers will be taken to the Constitutional Court. 

The President of the Catalan Government, Artur Mas, insisted on Friday that “a clear absolute majority” will be needed for the pro-independence parties in the early elections scheduled for 27 September to make the world understand that the creation of a new independent state must be negotiated. In a radio interview, Mas explained that the road map towards independence - if there is an electoral majority - is still being negotiated among the different parties and organisations, in order to run separately but with a shared road map in case of victory. This road map would include demanding the start of immediate negotiations with the Spanish Authorities to reach an agreement on Catalonia’s independence from Spain if a majority of citizens vote for this scenario on the 27^th of September.