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Catalonia crisis hurting region's economy

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More than 2,000 businesses representing nearly one-third of the GDP of Spain’s restive Catalonia region have fled it due to political uncertainty, according to Catalan entrepreneurs visiting Brussels.

Axar.az reports citing AA after meeting with European politicians in Brussels this week, Carlos Rivadulla, deputy chair of the Catalan Entrepreneurs association, told Anadolu Agency that the crisis over the region’s independence drive has started to hurt its economy.

Employment in Catalonia declined over 10 percent in October from the same period last year, while consumption fell as retail companies operate with very low profit margins, Rivadulla said.

He added that retail sales in Catalonia declined 5.4 percent last month following a 5.5 percent rise in September.

CaixaBank and Banco Sabadell -- the region’s second- and third-largest banks, respectively -- as well as two energy firms were among the nearly 2,000 companies that left the region after the Oct. 1 independence referendum, which Spain’s Constitutional Court declared illegal.

Catalan tourism, one of the region’s main sectors, was also hit by the ongoing crisis, as hotel bookings fell nearly 25 percent, Rivadulla said.

Stating that the situation would also lower tax revenues in the coming months, he pointed to next month's election as a chance for economic recovery.

Snap regional elections will take place on Dec. 21, with separatist and unionist parties vying to take control of the region.

Catalonia’s GDP per capita was €29,576 ($35,082) last year, according to figures compiled by the Turkish Embassy in Madrid, compared to €24,100 ($28,586) for the whole of Spain.

The Catalan economy grew 3.5 percent last year to reach €222.5 billion ($264 billion) and foreign trade rose steadily from €132.7 billion ($157.4 billion) in 2014 to €142.7 billion ($169.3 billion) in 2016.

Although regional unemployment stood at 14.9 percent last year, it still compared favorably with a rate of 20 percent across the country as a whole.

Date
2017.11.09 / 18:22
Author
Axar.az
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