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The Catalan Government rejects accusations of privileges and states that it will need 11,000 million euros in 2011

After yesterday’s meeting with Spanish Prime Minister Zapatero and the Catalan President, nine Autonomous Communities are protesting and accusing Zapatero of giving privileges to Catalonia. The Catalan Government rejects these accusations recalling that all the discussed transfers were pending issues that had already been agreed on. The new debt will be used to re-finance previous debt and reduce the deficit. This evening, the Spanish Ministry of Economy clarified that Catalonia’s authorisation will be applicable to all the Communities with an approved viability plan.

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08 February 2011 11:22 PM

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ACN / Gaspar Pericay Coll

Barcelona (ACN).- As usual, when the Catalan Government meets the Spanish Government to bilaterally discuss competence devolution and revenue transfers, other Autonomous Communities protest. This time was not an exception, especially when elections in many Autonomous Communities are in three and a half months. \u201CIt is time to defend Catalonia\u2019s interests\u201D, said The Catalan President Artur Mas. Yesterday, after the encounter with the Spanish Prime Minister, the Catalan President insisted he was only defending Catalonia\u2019s interests, just like all the parts do in politics. He added that he was defending what was already owed to Catalonia and not paid yet. He was referring to the more than 2,1 billion euros than the Spanish Government still owes to Catalonia from previous years (i.e. 759 million euros from 2008) and the 35 competence transfers foreseen in the current Spanish legislation but that were not transferred in the end or were incomplete. On all of these transfers, only the 759 millions from 2008 were actually agreed, the rest is to be discussed in the future. However, another important issue was agreed: the Catalan Government\u2019s capacity to issue new debt if its viability plan is approved.


In fact, the other Autonomous Communities\u2019 indignation was not caused by the money transfer but actually by Zapatero\u2019s authorisation to Catalonia to issue new debt, a debt that will not increase the deficit. On the contrary, this new debt will be used to re-finance short-term loans that are expiring and reduce the deficit to 1.3% this 2011. However, other Autonomous Communities or big cities such as Madrid have not been allowed to do so in the past weeks, as their viability plans were not approved or close to be approved. Now nine Autonomous Communities are protesting: Aragón, Madrid Community, Castilla-la-Mancha, Castilla-León, La Rioja, Navarra, Múrcia, Cantabria and Valencian Community. This evening, the Spanish Ministry of Economy clarified that the authorisation was not exclusively for Catalonia but for all the Autonomous Communities with an approved viability plan and with the condition that the new debt is used to re-finance the expiring loans and reduce the deficit to 1.3%.

Prime Minister Zapatero stated this morning that he was \u201Cquite satisfied\u201D with yesterday meeting\u2019s outcome. He said that he trusted the seriousness of the Catalan viability and austerity plan, which has to be approved in the coming days or weeks. This plan foresees reducing the current deficit from 3.6% to 1.3% in one year and decreasing the Catalan Government\u2019s budget by 10%. Zapatero said he will allow the Catalan Government to turn to the financial markets or private citizens to ask for more money.

11,000 million euros needed in 2011

The Catalan President, Artur Mas, quantified the needed amount for 2011 in 11 billion euros. In fact, Mas stressed today in a radio interview that this new loan will be used to refinance the debt that is expiring and to contribute to reducing the deficit. For instance, with this money they will pay the one-year bonds the Catalan Government issued last autumn, which represent 2,500 million euros plus interests. Mas wanted to stress that all this new debt would come with a reduction of the budget of 10% in 2011 and a final public deficit of 1.3%.

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  • PM Zapatero (left) today with the Socialist Group's spokesperson at the Spanish Parliament and the Economic Vice President (ACN)

  • PM Zapatero (left) today with the Socialist Group's spokesperson at the Spanish Parliament and the Economic Vice President (ACN)