Business Over Tapas25 August 2016 Nº 174

25 Agosto 2016  Sección; Especiales 757 votos

Editorial:

The Partido Popular has agreed to the conditions put down by Ciudadanos in exchange for the smaller party’s ‘abstention’ in the second parliamentary investiture (a tactic designed to give power to the PP). The conditions are to do mainly with corruption issues (as re-defined by Ciudadanos), but only at a national level (it was thought to be too fiddly to move through the rest of Spain’s political offices). Eyes are evidently trained on such players as Senator Rita Barberá. A number of corruption cases against the PP (including the Gürtel) are timed for this autumn (to complicate matters further).

For an investiture, the PP would need, besides Ciudadanos, the passive support of Coalición Canaria and the PNV. If the investiture fails, then the next elections will be on Christmas Day (!!) warns Mariano Rajoy, blaming the intransigent PSOE for this quite terrible date (engineered, evidently, by Rajoy). In return, the PSOE is looking at a constitutional solution to move the next elections up to the 18th of December. They also have made a suggestion that they would not stand in the way of a minority PP government... if it were led by another candidate instead of Rajoy.

The only reason to support Rajoy, says one newspaper, is through sheer political exhaustion. One opinion (shared over a beer) suggests that the egocentric Rajoy wants to win the prize to then quickly stand aside.

The first debate will be held on Tuesday August 30th; the second – where a simple majority is enough, is marked for Friday, September 2nd.

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Housing:

From the environmentalists comes the news that the Spanish coastline is disappearing under more and more cement, with El País reporting that: ‘27.8% of the 7,898 kilometres of coastline of Spain has already been developed or transformed by man. In the 24 years between 1987 and 2011, the occupation of the first 500 meters from the sea grew by 32.9%, at a speed of 22.7 kilometres every 12 months...’.

What Spaniards want from a holiday-home in Spain’? A lot for a little, unsurprisingly. Read the story at Spanish Property Insight here.

A group of expats have been left without water for the past six months. The group in Villafranco del Guadalhorce have been given a series of excuses for the shortages that began in February. According to bosses at Alhaurín el Grande, that administers the village, the problems began when a pipe split on private land...’. From The Olive Press.

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Tourism:

Hotels report a 15% hike in the number of British customers this summer (and, an average price rise for themselves this year of 6.3%). Story here.

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Finance:

Spanish banks have analysed their financial future in the wake of the UK's vote to leave the European Union and the uncertainty which currently reigns until Article 50 is triggered and the results of negotiations between Britain and the other 27 EU nations are known...’. Article found at Think Spain here.

Do you remember the summer of 2012, when Spain’s risk premium reached a record high of no less than 638 basis points? Four summers later, this spread seems like it belongs to a completely different country. Since that fateful summer, Spain’s sovereign risk has declined nearly 550 bp and just last week broke the 100 bp threshold...’. From The Corner. The subject is also discussed at Marca España with their article ‘Injection of confidence in the Spanish economy’ here.

Bank secrecy for tax purposes is coming to an end as a growing number of countries commit to automatic exchange of information. Soon there will be nowhere left for tax cheats to hide’. Thus, the introduction to a video called ‘Crackdown on Tax Evasion’ by the OECD. From the Organisation for Economic Co-operation and Development: ‘The Standard for Automatic Exchange of Financial Account Information in Tax Matters provides for annual automatic exchange between governments of financial account information, including balances, interest, dividends, and sales proceeds from financial assets, reported to governments by financial institutions and covering accounts held by individuals and entities, including trusts and foundations. The new consolidated version includes commentary and guidance for implementation by governments and financial institutions, detailed model agreements, as well as standards for harmonised technical and information technology solutions, notably a standard format and requirements for secure transmission of data...’. The above was published in 2014. Spain has undertaken to join in next year. Unlike the asset declaration (Modelo 720) exercise which has certain thresholds below which reporting is not required, for example on bank accounts, there appear to be no such restrictions under the OECD guidelines, so even very small accounts would be reported automatically. Will the information report the history of accounts, and if so, from what date? Does the massive provision of personal information where there is no crime or tax evasion involved, violate EU norms regarding personal data protection? (Thanks to Chuck for info here).

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Politics:

Mariano Rajoy will be put to a vote as candidate for President on 30th August, with the second round (where he has a slim chance) on September 2nd. If not, and failing a challenge from the left, then, as El Mundo colourfully puts it: ‘El día de Navidad. 25 de diciembre, fun, fun, fun...’. ‘Let’s see if you have the courage to send 36 million voters out on Christmas Day’, as the tall Catalonian popular Xavier García Albiol says to the PSOE in a nice bit of demagoguery...

Arnaldo Otegi will not be the candidate in the Basque elections for the EH Bildu party, says the Electoral Board, as he is ‘inhabilitated’. Unless things change... The story at El Mundo.

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Corruption:

As if Spain’s interim Prime Minister Mariano Rajoy didn’t have enough on his plate trying to rally votes for an investiture vote in Congress next week he looks set to lose – which may mean a second bid in October – the upcoming trials of several senior figures in his Popular Party (PP) will further weaken his position in talks with other parties to form a government...’. Found at El País in English.

El Diario reports that there were many and massive bribes during the time that Rita Barberá was mayoress of Valencia. The story confirmed by the judge investigating the Caso Taula, and denied by Barberá’s lawyers.

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Catalonia:

The pro-independence grass-roots organisation Catalan National Assembly (ANC) urged the Catalan Parliament to call a binding unilateral referendum on independence this autumn. ‘This is the petition of the ANC to the institutions’, said the president of this civil society group, Jordi Sánchez, pointing out that in autumn Parliament will ‘probably’ be in a position to organise the vote...’. Report from Vilaweb here.

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Brexit:

The Doors to the UK

The rejection of immigration played an important role in the outcome of the British referendum. The xenophobes won, so: now what? What will happen with immigration to the UK from now on? The short answer is "probably nothing."

Let’s see: only part of the immigration to the UK is from the EU and therefore the changes, post referendum, will only affect this group. It should be stressed that it is only "possible" because right now it is not even clear what will actually occur or indeed whether the whole ‘Brexit’ debacle will be paralyzed by the British institutions themselves.

But suppose the UK effectively leaves tomorrow from being a Member State of the EU. Since it is not a member of the Schengen area of ??free movement of people, or is only partly, it could in theory impose visas for European citizens wishing to enter the country. That would not change the situation of those already inside – 2,300,000 EU foreigners – but it would reduce their international mobility. To avoid an economic collapse, the government and parliament would have to draw up new rules to permit the granting of a permit to stay and work for all those who are already working there. Likewise, to avoid the collapse of the university system, which lives largely off foreign students, they would have to speedily grant permissions for EU students. And what about the precious NHS, the public health system, which is maintained through the work of foreign doctors and nurses, in large part from the EU, while British doctors emigrate to the United States where they can earn much more money with a private consultation? The British should have already implemented policies to eradicate illegal immigration, as they have proved unable to do in the past. There is no sign that they can do so now: after all, the business of those who profit from illegal immigration has had far more political weight than the complaints of local workers displaced by immigrants. Remember: it is a liberal system.

Would the British dare insist on a visa requirement for all EU citizens? Will they want to put difficulties in front of the German businessman, the French student and the Italian tourist? What would happen to the business of many families who literally make a fortune thanks to European students who spend the summer with them as they try to learn English? In fact, among the EU citizens based in the UK, the only ones who seem to bother them are the migrants from Eastern Europe. Could they exempt visas from some EU countries and not others? They could, of course, but that will not win them the support of the Eastern States in future negotiations with the European Union to sign a trade agreement that allows them to continue to access the Single Market. Poland, Romania and Bulgaria could block any trade agreement or otherwise with a UK that prevented the easy entry for their nationals. Would the British be so foolish as to sacrifice their access to the single market? Probably not.

As for refugees, their free arrival in the EU by way of the Balkans has increased the fear in the UK of being affected by a Europe unable to manage its borders. However, the Brexit could reduce rather than increase the management capacity of the UK on this issue.

On the one hand, if the UK were out of the EU, then the French government could stop cooperating with them in controlling the passage at Calais and, without further ado, allow thousands of immigrants and refugees trying to cross the English Channel too freely do so. They would no longer have to hide in the back of the trucks, they could simply take the ferry like any other traveller, and those unseemly camps in northern France would move to the South of England. Moreover, the UK, part of the European Asylum System, returns every year thousands of asylum seekers, pursuant to the Dublin Regulation, the country through which they entered the EU. This regulation is now questioned and subject to revision and the UK is going to find it more difficult to influence the discussion if it is outside the EU.

What can happen to the British who live in other EU countries? They number 1,800,000 according to sources in the UK, which probably underestimate the figure. States where they live, such as Spain, home to some 300,000 British (258,965 according to the INE) (believe that or not), decide whether or not to grant them automatically a residence and work permit, or force them to undergo general immigration legislation, which would leave many of them open to illegality and the risk of expulsion, and the signing or otherwise of agreements with the UK that allow them to enjoy public health in the EU countries. The incentives of each member state of the EU to deal with exceptional generosity towards British residents will of course be in direct proportion to the opening towards European citizens by the future British Government. It is simply an exchange of people: 1,800,000 British in other EU countries against 2,300,000 EU citizens in the UK. With the difference that very few of these 2,300,000 are retired and therefore their financial contribution to the British state is much more important than that of the generally retired ex-pats. In other words: the British economy cannot afford to suddenly lose their EU foreign workers. But, on the other hand, the rest of the EU economies can indeed comfortably do without their British retirees and workers. This makes clear that the UK has little or no bargaining power on this issue to the EU, when it came time to negotiate merely as just another foreign state.

In short, the most likely is that there will be little or no change on this issue and that the UK ends up having to settle for as much, with the crumbs that the EU offered them before the referendum to appease the Euro-sceptics. Of course, the United Kingdom will not find much sympathy from its erstwhile EU partners in any fresh negotiations’.

The article comes from Carmen González Enríquez writing in El País here.

A second opinion piece from El País, applauds the close friendship between the United Kingdom and Spain and discusses the positive influence of the one upon the other. ‘Let us hope that the ‘Brexit’ does not ruin that friendship’, concludes the essay.

‘“I hope the Spanish government lets me stay until I die” Post-Brexit, British residents in Spain are uncertain whether to go home or apply for citizenship’. From El País in English here.

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Various:

The Spanish Olympic Team has successfully concluded its participation in the Rio 2016 Olympic Games. Spain achieved 17 medals (7 golds, 4 silvers, and 6 bronzes) and finished 14th in the international medals table...’. From Marca España.

Puerto Rico’s supporters for an annexation of the island by Spain say they are looking for some sign of interest by the Spanish foreign ministry. ABC reports.

The largest supermarket chains in Valencia, together with other food and beverage companies, are united in their efforts to stop the new law forcing all drinking containers to be ‘returnable’ rather than to become instant garbage. Story at Valencia Plaza here.

The World’s smallest annual cinema festival, held in the tiny hamlet (six houses) of Ascaso, lost in the high hills of the Aragon Pyrenees, began on Tuesday (through Saturday 27th). The organisers say they are pleased things are going well, but they would be appreciative if the power company supplied the hamlet with electricity. More at El Diario here.

It's one of the world's most mysterious books, a centuries-old manuscript written in an unknown or coded language that no one -- not even the best cryptographers -- has cracked. Scholars have spent their lives puzzling over the Voynich Manuscript, whose intriguing mix of elegant writing and drawings of strange plants and naked women has some believing it holds magical powers. The weathered book is locked away in a vault at Yale University's Beinecke Library, emerging only occasionally. But after a ten-year quest for access, Siloe, a small publishing house nestled deep in northern Spain, has secured the right to clone the document -- to the delight of its director...’. Found at France 24 here.

There are over 8,000 municipalities in Spain, of these; there are 1,222 with less than 100 inhabitants: mainly in Guadalajara, Burgos and Soria. The list here.

An essay at Fijando el Norte on how our gooey view of animals – and our rejection of bullfights – comes largely from Walt Disney’s influence on children’s entertainment.

From Postcards from the World: ‘If I tell you that Spain is a paradise for the senses, I guess I am not discovering anything new to you all. But in this post I am not going to talk about the beautiful beaches in Spain, nor the excellent wines, neither the amazing museums nor architecture all over the country. In this post, I am going to share with you the 10 traditional dishes you should try whenever you go to Spain, apart, of course, from the jamón ibérico de bellota, the tapas or the churros...’.

The London Spanish Film Festival launches its 12th edition with an extraordinary line-up of recent Spanish films, most of them UK premieres and a unique opportunity to watch them in London. From enigmatic thrillers to fresh comedies, from poetic dramas to international co-productions, documentaries and promising shorts, this year's line-up offers an insight into the compelling variety of Spanish cinema and its artists...’. The dates: 22nd – 29th September. More here.

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See Spain:

Montefrío, Granada. Visitor numbers to the town have skyrocketed following a report in the National Geographic Magazine describing the town’s magnificent views. Video report at Expansión here.

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Letters

Opinion from Samantha Kett:

According to the latest, the third elections - if they cannot be avoided - will be on Christmas Day. Clearly a tactic - there'll be a lot of malestar among people called up for compulsory polling station duty (probably those who can afford it will decline and pay the fine to avoid it) and the only ones who'd be willing to walk away from a tableful of giant prawns and turrón, nursing a hangover, to cast their ballot will be the die-hard PP sycophants (or psycho-pants. Or sheeple). The Double-thinkers who still maintain, despite hard evidence, that the PP has brought Spain's economy back to growth and repaired the financial damage 'caused by the PSOE' (as opposed to by a global crisis, selfish tax-thieving by PP regional governments, too many politicians in the kitchen costing public money for doing very little, and a set-in-their-ways stuck-in-the-dark-ages 1950s' top-down factory-fodder labour market, devoid of any shred of imagination or initiative, which survives on a culture of non-payment and false-economy cost-cutting at the expense of quality, trading when and how they want and not when and how the customer needs them to, with complete disregard for the workers who actually earn them the money or the customers who pay it to them). Unemployment is the same as it was under ZP, except in summer in tourism belts where the ultra-qualified multi-lingual graduates and post-graduates get 48-hour-a-week bar jobs for the minimum wage for three months, and do them badly because of inefficient practices that nobody's thought to address but which they're not allowed to question because they're not the boss. What little employment has been created is 10-hour weeks in degradingly-menial jobs for less than a minimum wage that should have been doubled years ago, and with most of their hours off-contract and paid in cash. If you're under 22 or over 40 (or even 35) you're unemployable, likewise if you're foreign, however well you speak the language or however long you have lived here, and the fiscal burden on the self-employed, plus the huge non-salarial staff costs, mean jobs are just never going to be created until there's a massive culture change which needs to be enforced from above by an open-minded, worldly, well-travelled and commercially-experienced government. And the debt!!!! The PP is the only party able to repair the economy and it's in a better state than it was before they got into power? Yet Rajoy's shower has left us with a debt not seen in over a century - and the EU only didn't fine us because they knew it'd be the taxpayer suffering, and there just aren't enough taxpayers left. And economic growth means nothing. Third-world countries see massive economic growth every year, and standards of living remain appalling and even get worse.

If the PSOE is going to vote 'no' to Rajoy (and I agree they should), why don't they get off their arses and try to form an alternative government, instead of acting like a spoilt child denied sweeties around Podemos for the sake of misplaced pride? Which do they prefer - another four (more than five) years of Rajoy, or swallowing their pride and working with Podemos? Likewise, Podemos and Ciudadanos are acting like children around each other. The three have enough points between them that they agree on to enable them to find common ground. What's the point of allowing a poor, unproductive, inefficient, self-serving, resource-draining government with no interest in the state of the country or the people, to get back into office, just for the sake of having someone in it?????!!!

I've always said this - the voting public (which should include all foreigners who have lived here at least X years) should be asked to vote for policies, from a menu, not for parties or people. The parties or people who devised or support these 'winning' policies should then be given the job of acting on them. And ALL electoral promises should be contractually-binding with the promissor held personally liable for failing to keep them. That'd stop narcissists from running for office just to puff up their chests and feel important in order to hide their insecurity and small dicks.

A letter to a BBC reporter:

I write to you as co-founder of the British ExPats Association (Spain) webpage.

Post Brexit, you will be aware that the Sterling has plummeted relative to the Euro. Pre Brexit it was around €1.30 to the Pound – today it is € 1.15 – a reduction of 15%. There are around 1.5 million ExPats that live within the European Union but outside of the United Kingdom.

Our Association is deeply concerned that no one within the Government, nor the Opposition, gave any thought to the possible “immediate or midterm” consequences for ExPats – particularly pensioners.

I wrote a letter to the Chancellor, with copies to the Prime Minister and Tim Farron, asking them to consider making trading in currencies illegal. I do not consider it sensible or morally ethical to allow a chosen few, working for six or so banks, to determine the financial wealth and well being of a Country. I have suggested a model upon which currencies could be evaluated by an International Currency Committee, with periodic meetings to make adjustments.

I have attached a copy of the same.

The ramifications for ExPats, and indeed the U.K, if they do not heed my warnings are profoundly serious.

Take the worse scenario – mass repatriation. Imagine the cost to the Department of Works and Pensions. A vast number of pensioners would be able to claim a raft of benefits and allowances currently denied to them. Additionally many would leave their resident Country having been unable to sell their properties as the markets are only open to those prepared to give their properties away. By way of an example – a friend of mine who relocated to Spain in 2003 has recently sold his villa here for € 75,000. He bought the villa for around € 200,000 in 2003. His villa had been on the market for over 3 years. He is now residing in sheltered accommodation.

Our Association has heard of owners of mortgaged properties who are seriously considering repatriating having first handed the keys to their property to the bank before returning to the U.K.

There are many other areas of concern that need discussion and addressing e.g. Health Care, the E.U for residents post Brexit.

I would appreciate your support and if you have any U.K Press contacts who you feel might be interested in writing about our concerns please point them in my direction. Emails can be sent to Esta dirección de correo electrónico está siendo protegida contra los robots de spam. Necesita tener JavaScript habilitado para poder verlo.

Thank you for taking the time to read my email.

Regards, Peter Woodall

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Finally:

France, the United States and Spain were the three countries who received the most tourists in 2013. Spain, in third place, had an impressive 60.7 million foreign tourists (68.1m by 2015, maybe 72m for 2016). Of these three preferred destinations, Spain relies much more on its tourism as a vital addition to its GNP (10.9% according to OCDE in 2012), and if things were to go suddenly wrong in this industry – a terror attack, an outbreak of some mortal disease, the sudden collapse of a hotel or a sharp increase in the price of gin – this could easily change. Indeed, tourism is one of the most fickle of industries, where cheaper offers or new resorts opening up can bring about rapid redeployment of the tourists, their wallets and their beach-towels. You might argue that encouraging 'residential tourism' would make more sense, but this is not an area with a ministry, a champion or a budget’.

BoT editorial from Aug 20 2014

 

Business Over Tapas25 August 2016 Nº 174

A digest of this week's Spanish financial, political and social news aimed primarily at Foreign Property Owners:

With Lenox Napier and Andrew Brociner. Consultant: José Antonio Sierra

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