Catalan business leaders ask the King to help restore the region's reputation.

On Thursday 27 June 2019 King Felipe VI of Spain visited Barcelona. He met with Catalan business leaders and representatives of civil society who asked for his help in recovering the city’s business reputation after the damage done by the nationalist coup in 2017.

Manuel Albiac, Dean of the Tarragona Bar Association, spoke of “His Majesty’s willingness to visit” Catalonia and “to participate in the life of Catalan society.” “We asked him that it should be so and that he should not stop visiting us. The King cannot cease to exist, nor cease visiting our community. That is what the people are asking and we want him to be here to visit us. We have asked him for this closeness and for these visits to take place frequently.”

This is more than common courtesy. The King of Spain is scrupulously above party politics and the day-to-day government of the country, but he is more openly active in representing the overall interests of the country than is the Queen of England. On 3 October, at the height of the Catalan crisis, he gave a TV speech that made it clear that the Constitution would be upheld. His father Juan Carlos did the same to put down the first coup against democracy in 1981.

Any help that he can give to the beleaguered Catalan economy will be very welcome. In autumn 2017 companies started leaving in droves, including the emblematic CaixaBank and Banc Sabadell. CaixaBank is not only Spain’s second largest; it was a huge symbol of Catalonia. Its departure to Valencia was as if the Royal Bank of Scotland had moved its head office to Newcastle. At the end of the day though, business considerations prevailed; not only was the risk, especially for a bank, of remaining at time of great political uncertainty too great, but it had more deposits in the rest of Spain than in Catalonia, so the risk of angry customers closing accounts, which was widely threatened on both sides of the market, fell against Catalonia. At that time too, many customers of all banks moved their accounts to branches outside Catalonia. Now, Catalonia has no bank except for one tiddler that caters for engineers.

It is true that these two banks still operate normally in Catalonia, and that in most cases the thousands of companies that have left have not moved production facilities or service offices, but that is far from being the point. Head offices in Madrid will invest in Madrid when new facilities are required or when corporate structures are reviewed, and companies seeking to invest in Spain will look away from Catalonia. Moreover, companies pay tax in the community where they are registered; the fall in tax revenue is very high. The shadow of Quebec looms over Catalonia. What was once the economic powerhouse of Canada was abandoned by companies moving to Toronto and other cities in search of a more attractive business environment than the nationalist madhouse that Quebec had become. As well as the two banks, companies that have gone include such giants as Abertis, Gas Natural Fenosa and Cola-Cao.

This graph shows the scale of the problem. The left-hand column shows the number of companies that have moved from Catalonia to each autonomous community, while on the right we see the net change in company registrations. These figures are for 2017 to the first quarter of 2019.

El País

Empresarios de Barcelona piden ayuda al Rey para reconstruir la reputación de la ciudad

(Barcelona businesspeople ask the King for help in rebuilding the citry’s reputation)

ABC

El «procés» ha empujado a salir de Cataluña a 5.244 empresas

(The independence process has driven 5,244 companies out of Catalonia)