Acting as an “agent provocateur”, Catalonia’s government intends to hold a wholly biased and unrepresentative independence referendum in early October. It knows the outturn will hardly attain half of the potential voters, as only a minority of the population favours an outright split from Spain.
Another solemn announcement by the Catalan government, another date for the diary. On October 1, the Catalan people will be asked to vote ‘yes’ or ‘no’ on the following question: “Do you want Catalonia to be an independent state in the form of a republic?”. The Catalan separatist camp, led by regional premier Carles Puigdemont, hopes for a victory that will then see the north-eastern region declare independence from Spain.
In Madrid, much of the media and most commentators, -not to mention the big national parties — tend to be bewildered, if not outraged, by the secessionist drive. When in Catalonia (or at least speaking to independentistas), I find that the opposite is true: disenchantment with and disdain for the Spanish state is almost a given and the word “independence” tossed around as if it were a football.
I hate this endless temptation for bracketing time into what we call “years.” Time is time and, by definition, there are no interruptions. The problems which beset us in 2016 are still here, whether it’s terrorism or open warfare or Spain’s ingovernability. Thinking it’s going to be very different in 2017 is deceiving ourselves.
The savings banks which were bailed out by the FROB continue to present problems for that institution and the government. The idea was that after they were restructured and their value had increased, they would find a buyer or incorporate a partner with a controlling stake or seek a stock market listing. So then they would give back at least a good part of the state aid received from the FROB. But these plans are turning out to be difficult to implement.
AXA IM | Four months after the elections, negotiations to form a government officially failed and new elections will be organised on 26 June. However, it remains very unclear that their outcome will be more favourable, though probably conducive to a government as a third round of elections would be a tremendous failure. Fiscal consolidation and Catalonia’s independence will be top priorities.
The political risk in Spain is a totum revolutum, where even the analysts cannot agree on what factor carries the most weight: either the Catalan secession process, the appearance on the scene of a political force like Podemos or the possibility that the delicate balance acheived through the timid reforms implemented by Rajoy’s government could be destroyed.
Spanish politics will be under the spotlight this week in Europe. The most likely consequence is that Spain’s risk premium will increase and the Ibex will underperform relative to other European stock exchanges.
UBS | Pro-independence parties in Catalonia have won a majority of seats – but not of the total of votes cast. As a result, we would advise investors to remain cautious about buying Spanish sovereign debt until some clarity emerges over the next steps of the new regional government.
Parties staunchly supporting independence have won the elections to the regional Parliament only in terms of seats, not votes.