Business Over Tapas

Editorial:

Two stories below, from Time magazine and The Telegraph. The first provides a ‘conservative estimate’ putting the British in Spain close to 850,000 souls, while the second tells us of ‘an estimated 761,000 Britons living in Spain’.

Who makes these estimates we hear so much about?

What about The Courier, also quoted in this newsletter? They say the Britons on the padrón (registered in the town halls) across the province of Alicante have fallen from an impressive 131,000 of them back in 2013, to just 14,000 now.

The population figures used by the Spanish (and no one else) come from the National Institute of Statistics, the INE. According to them, there are 263,029 Britons living in Spain. No arguments, please, that’s the number.

This painfully exact number comes from information provided by the town halls, as coming from their register, the padrón. It used to be a useful guide, for Spaniards, as, if they left one municipality for another, there would be an automatic adjustment in the register, but this is no longer the case today, as many Spaniards have found work abroad, but continue to be registered as local. For foreigners, the padrón is even less exact; and now the rules state that we must re-register every five years, as Europeans, or two years, as simple foreigners.

But what is a ‘resident’ – someone who lives here full time, or partly, or has two homes, or has been away for some time but remains on the padrón for whatever reason? The exact number becomes more and more suspect. And what of those who don’t register, afraid that they will somehow be put onto some other list, perhaps to do with the tax-people? The town halls like to inflate their population register, as it means more licences, more services, more funds. Again, more flubbing.

Furthermore, with the new tax law, the dreadful Modelo 720, where one is expected to declare one’s worldwide holdings – how many foreigners have simply thrown in the towel and left Spain for a more welcoming country like Portugal, or have returned in disgust to their country of origin? Then again, why own a property in Spain if you can no longer occasionally rent it out without enormous inconvenience?

So how many Britons (or Germans, or Dutchmen) live in Spain? The padrón is not the answer; perhaps a better way would be to check the contracts with the electric companies. But that is not the Way of the Statisticians.

Housing:

Some sanguine predictions found at Mark Stücklin’s Spanish Property Insight: ‘Experts forecast 12pc growth in home sales this year’.

Spanish property (concentrating on Puerto Banús): a write-up in The Irish Times. ‘...The positive news, if you are in the market for a property in Spain, is that prices are still down more than 50 per cent from peak in most areas. The higher end has not been affected as much, as there are usually more owners who can afford to hold out for better market conditions, but it has still made an enormous difference to asking prices...’.

Spaniards appear to search online as a preferred way to find a home, says Kyero: ‘...The desired location and price are the most important search criteria for Spaniards, and 81% of them indicated that before physically viewing any homes they search for suitable properties online, looking at property portals’ websites, websites of real estate agencies, and social media profiles of companies in the real estate sector...’.

From the Sur in English: ‘Many owners of holiday rental properties are now rushing to register them as tourist accommodation in order to comply with new regulations which come into force on 11 May. The number of applications to register a property on the ‘Registro de Turismo de Andalucía’ had increased by 705% by the end of April, according to Monsalud Galindo, the regional government’s Tourism delegate in Malaga. Between 1 January and 30 April, there were 1,736 applications to register rental properties, compared with just 246 in the same period of 2015. Wednesday was the first day that registration numbers would be assigned, enabling owners to rent their properties legally...’. From Typically Spanish, we read that the Junta ‘...expects an avalanche of the registration of some 20,000 tourism apartments....

‘Is the Energy Performance Certificate (EPC) always necessary when buying or selling properties in Spain?’ A lawyer at Round Town News answers...

‘It’s sad that practically everything that has been written about Vera in the foreign press has been about us’, an interview with Helen and Len Prior at Actualidad Almanzora, who famously had their house in Vera (Almería) demolished in January 2008.

From David Jackson: ‘The British home owners association AUAN has informed the Spanish authorities of its intention to organise a peaceful demonstration in the Plaza Mayor outside of the Town Hall of Vera on Thursday 19th May at 12.00 noon in support of Helen and Len Prior. According to AUAN’s president, Maura Hillen ‘the reason for this gathering is to ask our authorities to once and for all find a way to put an end to the ordeal of Helen and Len Prior whose house was demolished without compensation in 2008 in spite of having planning permission’...’.

Tourism:

On one day last August, there were two million visitors congregated in the Balearics, twice the local population. How to slow down the onslaught, asks Preferente? Ideas include banning out-of-island cars, or sealing the number of beds available. The Guardian says ‘Tourism chiefs in the Balearic Islands could ban cars from the smaller islands during the summer months as the region braces for a record number of visitors. The islands of Mallorca, Menorca, Ibiza and Formentera, which have a population of 1.1 million, are expecting 13.5 million visitors this year...’.

An item in El País says that 1,184 million people visited another country for pleasure in 2015 and that in 2016, this number should increase by another 4% or so...

Finance:

The ‘crisis’ has proved the end of the Middle Class in Spain for three million people, says El País here. The poorer households have grown from 31.25% to 38.5% of the total.

The Seville-based clean energy company Abengoa, in critical condition following its huge debts, has just been dealt another blow as its assets have been found by accountants acting for its creditors in a due diligence to be somewhere in the region of 1,000 million euros less than had been reported, says El Confidencial. An update on the stricken company comes from Wolf Street here: ‘Accounting tricks come home to roost.’

Every Spaniard owes 23,332 euros as their share of the Public Debt, 4.8% up on the previous year, says Yo Me Tiro Del Monte here.

From an editorial in El País in English: ‘...As recently as this week, the Popular Party (PP) continued to defend the kind of fiscal austerity imposed by the German government, while at the other end of the spectrum, Podemos is proposing ending austerity altogether and embarking on a public-spending spree with no thought to the consequences...’.

‘It was supposed to be the biggest, most ambitious, most lucrative infrastructure project Spain’s construction industry had ever undertaken on the Arabian Peninsula. Launched three years ago, the high-speed rail link project between Medina and Mecca was a dream come true worth some €6.7 billion, the perfect payoff of decades of patient lobbying of the House of Saud by Spain’s former King Juan Carlos I. But now it’s a rotting financial albatross around the necks of 12 large Spanish companies...’. Wolf Street has another go...

General Elections June 26:

In doubt about the veracity of your news – or is it just the way they report it? Says a left-wing news-site called Público: 84.4% of the militants in the IU support an agreement to go forward with Podemos for the General Elections. Pretty convincing! Says El Mundo: ‘Only one in four militants of the IU support an agreement with Podemos’. The newspaper adds, ‘The mayor of Zaragoza says ‘no’ and ‘Gaspar Llamazares warns against a union’. Both are factually correct, as only 20,000 of the 72,000 militants bothered to vote... At any rate, following ratification from the party members, the two political forces have joined together for the General Elections. The agreement includes giving eight seats in parliament to the IU. Then, to cap it all, El Mundo helpfully showed a front-page photograph of the two leaders sealing their pact with a beer (shades of Business over Tapas!).

The CIS survey shows the difference between young and old in their choice of party to vote for, with those over 54 years of age leaning towards the two traditional parties of the PP and PSOE (55%), against Podemos and Ciudadanos (18%). With the under 35s, the position is reversed, with 25% for the traditional parties and 51% for the two interlopers. More analysis at El Español (printed before the union of Podemos with IU).

‘Parties fail to reach agreement to cut election campaign spending. Disagreement between political groups means that another €130m will be spent on the repeat polls’. A report from El País in English. ‘The PP dynamites the agreement to cut election costs’ says El Español.

Following the union between IU and Podemos (which may not necessarily bring them extra votes, but under the election system, would bring them extra deputies), a new survey gives the leftist parties close to a majority in the next elections for June 26th. The results here.

Politics:

‘Former President Felipe González and the President of Andalucía Susana Diaz have sent a joint message of reassurance to the PSOE supporters on the outcome of the elections. ...

Speaking to the media before attending the celebration of the 40th anniversary of El País, the former president said that one should not be concerned about the chance that a Podemos/IU coalition could beat the socialists in the left-wing vote...’. Story at EMG.

Mariano Rajoy says that the union between Podemos and IU is ‘a coalition of extremists and radicals’.

From El País: ‘Mariano Rajoy and Pablo Iglesias want to turn the elections of June 26th into a second round: a battle between the moderation and wisdom claimed by the PP candidate and the radical leftist policies of Podemos, leaving a ‘no man's land’ for the PSOE to occupy. The threat of the electoral agreement between Podemos and IU overtaking the PSOE in public support, plus the political offer by Iglesias of a joint list for the Senate, are pressuring the campaign strategy of Pedro Sánchez. The socialist leader has been forced to reaffirm "the independent PSOE project"...’. The likelihood is that, following the elections, Sánchez will have to choose between the one and the other.

Following the loss of Granada, the Partido Popular now only rules two of Spain’s thirty largest cities – Málaga and Murcia (both in minority). A year ago, they held twenty of them.

Corruption:

The ex-mayoress of Valencia, Rita Barberá, will have her membership of the Partido Popular revoked if she is imputed in the Taula Inquiry, says a senior party-member.

‘The Junta de Castilla y Leon squandered in a year over eight million in jewellery, hostales rurales and Chinese bazaars’... says Vozpópuli. ‘The government headed by Juan Vicente Herrera (PP) also spent a total of 190,000 euros in restaurants and 2,000 euros in handicrafts. Payments listed under "miscellaneous expenses" of the General Account of 2014 have been uncovered by the PSOE. The PP, meanwhile, defends itself saying that "most of these expenses can be found in all administrations"...’. In all, they found 8.3 million worth of receipts in hard-to-justify spending.

Catalonia:

The President of Catalonia, Carles Puigdemont, says he is convinced that the European Union would quickly allow Catalonia to rejoin (if it seceded from Spain and lost its EU membership). ABC reports.

‘The Catalan President Carles Puigdemont announced that the Government will prepare new legislation to protect the core policies of the social emergency law suspended by the Spanish Constitutional Court (TC). The new law will include “practical tools with legal security” that will “reformulate” the suspended articles of the legislation but “keep its spirit”...’. More revolution over at Vilaweb here.

Brexit:

‘...Retirement of Millions of Brits Threatened by Vote to Leave EU. Two million Brits who live in EU face legal limbo if UK votes to leave’. A report at Time magazine. An excerpt: ‘...Officially, there are about 350,000 Brits living in Spain, to enjoy the sun and a substantially lower cost of living than in many parts of the U.K. In fact, conservative estimates put the number of Britons in Spain at closer to 850,000 – once those who have not declared their residence here to the taxman are taken into account...’.

Media:

An editorial on Spain’s ‘new and old journalism’ at El Diario. It notes: ‘We see every day have the traditional press hides information which citizens need to know, and how they protect economic interests and established politicians...’.

An article at El Ventano says – whimsically – that the conservative press is most concerned (most concerned!) about the possible dissolution of the Izquierda Unida after it foolishly joined forces with Podemos.

‘On May 6th, 2016 Euro Pacific Bank was named falsely in a Spanish online tabloid (OKDiario) claiming that the Bank opened an account and received a wire transfer for Pablo Manuel Iglesias Turrión. Euro Pacific Bank has never maintained an account for this individual, or received a wire transfer from any of the financial institutions, or sources named in the article. Furthermore the Bank does not maintain accounts for PEPs, or accept payments from Venezuela under any circumstances’. Statement from the bank where Pablo Iglesias (Podemos) was said by a Spanish news-site to have stashed some offshore cash. In a similar story – various unions and anti-corruption groups within the police have complained about the political pressure and misuse of public funds against Podemos. Lastly, the director of OKDiario was criticised for his ‘exclusive’ on live TV by his fellow journalists. Story and video here.

Economics:

Trying to Pull a Rabbit out of a Hat

by Andrew Brociner

We have looked at the un-sustainability of Spain's pension system recently. Just to add one more piece to this grim state of affairs, we now take a look at the social security reserve fund.

This fund was set up in 2000 to meet future pension payment shortfalls. Given some of the demographic concerns we have outlined, whereby with the population ageing, and the number of pensioners rising while the number of contributors for each pensioner is declining, the reserve fund was meant to ensure long term payment stability. During the boom years of 2000-2007, it was regularly and substantially incremented. In 2012, with the PP in office, this practice changed, and the government regularly tapped into and withdrew large amounts from this fund. From 66 billion euros at the start of 2012, the reserve fund has now been drawn down to 32 billion.

When the PSOE was in office, pension shortfalls were met from the government budget, and as can be seen from the chart, the fund was at its peak when they were voted out of office in 2011. But with the PP, the shortfalls were met by being withdrawn from this fund. As the payment shortfalls came from the budget before, they showed up as additions to fiscal deficits, but then, under narrower austerity deficit targets, the new government switched financing, making the deficits appear smaller (all the while saying, “see, austerity works” – which it doesn't) while taking reckless risks with the system which is already unsustainable. In the last three years, the reserve fund has decreased by 10 billion euros a year and at the current rate, it will have just three years left. In that case, the fund will be depleted just in time for the next decade to start when some of the demographic pressures begin to bite. The government has been irresponsibly biding time, taking tomorrow's money today just to get over the next hurdle, expecting nothing short of a miracle to happen in the future, but more likely, not caring what happens when they are not in office.

Various:

‘Brits insist UK immigrants speak English - so why don't expats in Spain learn Spanish?’ Headline at The Telegraph. An excerpt: ‘...With an estimated 761,000 Britons now living in Spain, representing nearly two per cent of the population, getting to grips with the lingo should surely prove a key objective?...’. (A silly article!)

‘The official British population in Alicante Province is down to under 14 thousand according to the latest government figures based on the local padrón registrations. 131 thousand British residents were on the council padrón three years ago, but figures have collapsed due to an apparent combination of people not renewing the document as well as those who are quitting Spain to return to the UK...’. From The Courier.

Sur in English has a similar story from the Costa del Sol: ‘Málaga province has lost over 9,000 foreign residents in one year. Many European retirees have returned home as they have grown older, and the economic crisis has also forced some immigrants to return to their own countries’.

It has long been a fantasy, a summer’s tale, but – could it be true? Those small planes flying high in the sky over Granada and Almería on cloudy days, when there’s a chance of rain. Rain, so badly needed, and yet, it never falls. Could those planes really be ‘espanta-nubes’, frightening the clouds away? The suggestion is that these airplanes are hired by the farmers upwind, perhaps in Murcia, to make sure the clouds don’t lose their precious load until they arrive over the thirsty Murcian crops. How do the planes do it? We are told that they drop silver iodide aerosol into the clouds, but – according to Wiki - this has the effect of causing rain, not inhibiting it. Still, to maintain the fable, even El Mundo is talking about it... We could clear this up easily enough: why not ask one of the pilots what they are carrying in those sinister-looking rods bolted to their wings...?

Spain uses silver iodide ‘to disperse hail-clouds’, says El País (in an article from 2001), ‘a system preferred by insurance companies to avoid costly damages’.

From Eye on Spain: Poll: Do you feel you have integrated into life in Spain?

‘Barcelona rises above Spain’s higher education malaise. Barcelona’s own version of the Crick Institute has helped the city’s academic ecosystem to thrive in spite of Spanish bureaucracy, reports Jack Grove from the Catalan capital’. From Times Higher Education.

Tráfico says they are winding down their use of camouflaged speed-trap cars on secondary roads. Now all radar traps will be advertised, says the Diario Sur. Although, a story here complains of a fine for slowing down when the driver noticed a radar trap!

‘The chart that proves that Spanish schedules are downright weird. The country does not observe its natural time zone, leading to a two-hour lag in just about everything’. Headline from El País in English. Yes, it does look odd!

‘We thought we were safe, we thought we were very safe. But it turns out that living in a reasonably quiet residential area on the outskirts of Sevilla is on par with the level of safety in the Latin Kings district in Madrid.

The only sign of violence or bad feeling in our first year here has been the sparrows fighting in the nispero tree. So I’m still a bit miffed about what happened last weekend in the early hours of Saturday morning...’. From A Novel Spain.

See Spain:

‘In the heart of Spain, nestled between mountains, sunburnt hills, and row after row of thriving olive trees, sits Madrid. Despite being the third largest city by population in the European Union, Madrid maintains the feeling of tranquillity and neighbourliness that is so often replaced by the rushed and stressed life of other big cities...’. From International Living.

Forty beautiful spots in Spain which you won’t be familiar with... From Minube.

Letters:

Lenox,

The BoT 159 is exceptionally well written. Why don't you publish a book on Andalucía, for instance "Strangers in Paradise"? Per

Thank you Per for your kind words. Me, I’m far too lazy. Lenox

Finally:

Tino Casals died 25 years ago in a car accident. Here’s his hit ‘Eloise’ on YouTube. Give him his due, he could hit the high notes. Wiki compares him to Liberace (or maybe Barry Gibb).