Rethinking Europe

Spain’s Catalan Independence Intermezzo

As much as quite a few Catalans may want independence from Spain, it is practically impossible. But more regional autonomy is certainly possible.

Credit: TonelloPhotography Shutterstock.com

Takeaways


  • The Catalan regional government has called an independence referendum for October 1, 2017.
  • As it stands, the decline in unemployment appears to have weakened the case for full Catalan independence.
  • The EU can accept new members only if all existing members agree. Catalonia would thus need Spain to say yes.
  • That Madrid would agree to outright Catalan independence looks highly unlikely, to put it mildly.
  • In a way, the solution has been obvious for a while: Catalonia stays part of a reformed Spain.

The Catalan regional government has called an independence referendum for October 1, 2017. Spain’s national government, with support from the country’s Constitutional Court, has vowed to prevent it.

The result could be a noisy mess that lasts for a while and, one hopes, will be followed by a period of reflection and then a deal for enhanced autonomy for Catalonia.

What do Catalans want?

Opinion polls show no clear picture. Support for independence in Catalonia had risen in response to the recent economic crises as well as the hard line which Madrid had taken in previous dealings with the region.

In surveys that, in addition to full independence, also give enhanced autonomy as an option, around 35% of respondents have recently supported full independence.

Polls that only allow a “yes” or “no” to independence (or undecided/do not know) as options have suggested a rough balance between those for and against independence in the last five months, albeit significant differences between individual polls.

As it stands, the decline in unemployment appears to have weakened the case for full independence somewhat since 2013.

Catalan unemployment and support for independence
Catalan independence chart

Quarterly average of Catalan opinion polls, last value is average of all recent polls (Q2 and Q3 2017).
Sources: Sociometrica, GAD3, GESOP, NC Report, DYM, Opinometre/CEO, Feedback, Wikipedia, INE

What may happen on October 1?

Technical preparations in Catalonia seem advanced enough at this stage that some vote may well be held in most of the region. But as Madrid has thrown up legal and practical hurdles, the voting will likely not be smooth.

At an earlier informal vote, conducted on November 9, 2014, 81% had opted for independence.

However, turnout was low, at just 35%. The result could be somewhat similar now: a clear majority for independence, but with a limited turnout as many opponents of independence may not choose not to cast a vote.

A period of confusion

The result could be difficult to interpret. In addition, it is very much an open question whether or not the regional government in Barcelona will indeed follow up with its threat to formally declare independence within 48 hours of a “yes” vote on October 1.

Even if Barcelona chose to do so, the practical consequences would likely remain limited.
Catalonia would not have the means, including the fiscal means, to enforce a full independence.

Remember the basic deal

Problems would soon abound. It is simply hard, if not impossible for anyone to see a practical way for Catalonia to become an independent country within the EU, no matter how fervently most supporters of independence may want that.

The EU can accept new members only if all existing members agree. Catalonia would thus need Spain to say yes. Put differently, Catalonia would have to settle its differences with Spain first.

That Madrid would agree to outright Catalan independence looks highly unlikely, to put it mildly.

A way out?

For that key reason, outright independence looks virtually impossible. However, the clear wish of many Catalans to have more say over their affairs is legitimate and requires a political solution.

In a way, the solution has been obvious for a while: Catalonia stays part of a reformed Spain.

Changing its constitution, Spain grants Catalonia special status with much more power over taxation, akin to the special status of the Basque region.

Such a deal may be very difficult to achieve immediately. But once the dust has settled after the upcoming imperfect referendum, Barcelona and Madrid ought to finally sit down in earnest to discuss their joint future – for the benefit of Catalonia, Spain and Europe.

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About Holger Schmieding

Holger Schmieding is chief economist at Berenberg Bank in London. [United Kingdom] Follow him @Berenberg_Econ

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