I was pleased to see that the Spanish foreign minister José Manuel García-Margallo had reacted swiftly to the afternoon absence of Pablo Sánchez-Terán the Spanish consul in Boston on the day of the marathon bombs, immediately removing him from his position. Pablo says in his defence that he always shut his office in the afternoon as he did on that day, two hours after the bombs went off – despite the unknown fate at the time of some 91 Spanish participants in the sporting event down-town. Actually, because of the Spanish system of job protection, I was doubly impressed to see him so quickly and publicly fired.
'Property prices in Spain will decline for at least another five years, as weak economic growth, high unemployment, and the lack of available credit will prevent the country from dealing with the massive oversupply of houses built before the crisis, a Moody's Investors Service report said Tuesday.
A tremendous level of construction in Spain saw the number of new houses for sale triple from 2005 to 2009, outstripping demand during the period, the U.S.-based rating firm said.
Spanish housing prices fell 13.7% in 2012, the largest single-year decline ever seen in the country, according to the country's statistics agency, INE. Since 2007, the year before the bust started, prices have declined just over 30% according to INE's estimates – and likely even more according to many private-sector economists.
"Spanish property prices will decline further at least during the next five years," Moody's said'... (More at Fox Business)
The Spanish government said Friday that it would invest €2.4 billion over the next three years to help the poor gain access to rental housing and renovate buildings to boost the stricken construction sector.
The plan, worth about $3.1 billion, aims to "guarantee access to decent housing to resolve the situation of people in difficulty" who cannot rent homes or apartments or who are having trouble managing real-estate debts, public works minister Ana Pastor said following a cabinet meeting.
By contributing to building renovations, the government also hopes to "contribute to the reconversion and reactivation of the construction sector, which as you know, needs it," she added.
Spain, the fourth biggest Euro-zone economy, fell into crisis after a real-estate bubble burst in 2008, and since then, officials have carried out 252,826 expulsion orders, 61 percent of all issued so far, according to a national judiciary council. (More at The Local)
'Considerations Before Purchasing Spanish Real Estate' from Property Abroad: Spain’s economic worries are far from over and the Euro-zone, in general, is anticipating increased problems over the course of 2013. Many potential investors are wondering if it is the right time to make an investment in Spanish real estate. While the decline in Spain’s real estate activity means that prices of homes and apartments have reduced drastically, there is also the concern of whether or not the acquisitions can be sold for a profit in the future. The Spanish government has implemented measures to make properties appear more attractive, and has also offered schemes luring investors from all over the world.
Although there are incentives for acquiring Spanish property, the element of risk is certainly worth considering before making an informed decision regarding the purchase of real estate in the Iberian nation. However, real estate experts in the country believe that buying opportunities may favour investors if they are willing to remain patient.
The prices of Spanish homes declined by approximately thirteen per cent during 2012, as home-owners found it extremely difficult to attain fair prices for their properties. While some chose to wait, other property owners in the country chose to sell their assets at a loss. Potential investors who are interested in Spanish real estate continue to remain sceptical about the market, but some buyers have a fair idea about how their investments will turn out...
Unemployment is threatening the collapse of the property market in Spain' says Property Abroad: 'Spain’s domestic real estate sector continues to suffer even at the end of the first quarter of 2013. Unemployment has been singled out as a key factor that has put the domestic market in its current predicament. At the end of March 2013, around six million Spanish nationals were out of work. The government’s plans to increase employment with a view to kindle economic activity continue to fail them and the nation’s worries are only increasing.
The Guardian’s economics correspondent, Phillip Inman, said that the unemployment levels currently experienced in Spain are reminiscent of the times when Franco was at the helm of the kingdom. Inman says that Spain was virtually an agrarian and feudal economy during those days when around six million employees were out of jobs. Although times have changed since Franco, the current situation of the economy spells uncertainty just as well as it had in the past.
As Spain readies itself for yet another downward spiral, the real estate sector faces increasing concerns. Distressed assets can only be moved by an increase in domestic activity, and the future looks bleak for the domestic market as there are no great expectations from the locals. Although overseas investors continue to actively participate in the Spanish real estate market, they have become rather picky over time and are now looking for more new and modern developments instead of settling for the toxic properties that are currently being sold by financial institutions. This change in the investment pattern means that properties that are currently on the books of Spanish banks will continue to remain unsold, thereby further reducing their values'...
'Thousands of Spanish home-owners might be deprived of their right to rent their properties with new legislation to be released next month. The Proyecto de Ley de Medidas de Flexibilización y Fomento del Mercado del Alquiler (which has been approved by Congress and is currently being processed in the Senate) includes dwellings for tourist use are no longer covered by the Ley de Arrendamientos Urbanos (LAU) and will now depend on the different regional or sectoral regulations that opens the door to a number of summer apartments that are now legal ceasing to be so.
Summer rentals currently benefit about 150,000 people in Spain, However the Government, in its national Plan Nacional Integral de Turismo, noted a "significant increase" of these practices (mostly marketed via the internet), which it says qualifies as "intrusion and unfair competition" for traditional tourism'... (From 20 Minutos). In other words... The hotels and hoteliers don't like the competition. There's more on this subject at Mark Stucklin's 'Spanish Property Insight' here.
A triumphant note from the Finca Parcs Action Group arrived at the offices of Business over Tapas on Friday: Yesterday Justice prevailed. Finca Parcs Action Group won in the Albacete Appeal Court with a sentence totally dismissing the Banco CAM Appeal.
Here is a translation of the final paragraph of the Appeal Court Sentence:
AUDIENCIA PROVINCIAL DE ALBACETE SECCIÓN PRIMERA
Apelación Civil 272/12
SENTENCIA NUM. 76
In Albacete 11 April 2013
We dismiss the appeal filed by the representation of BANCO CAM against the judgment of 8 June 2012 in ordinary procedure 182/11 issued by the Lady Judge of the First Instance Court No. 2 of Hellin. We CONFIRM that decision and order the appellant (BANCO CAM S.L.U.) to pay the costs of this appeal.
There follow two press articles. The Round Town News says:
'Shamed CAM Bank has lost its appeal and remains guilty of “malpractice” over a failure to guarantee the safety of 1.5 million euros in deposits for off-plan homes paid by 47 purchasers at Las Higuericas Finca Parcs development near Hellin.
The decision, announced yesterday afternoon (Thursday), brings hope to every off-plan purchaser across Spain who has lost money and underlines the legal responsibility of banks by becoming case law.
Keith Rule, co-ordinator of the Finca Parcs Action Group, told RTN: “We have won; this is an absolutely fantastic decision and upholds last year’s verdict of the First Instance Court in Hellin.
“CAM was found guilty of malpractice and a dereliction of its legal duties. Justice has prevailed. We have won in the Albacete Appeal Court with a sentence totally dismissing the Banco CAM appeal.”' and the Albacete edition of La Verdad leads with 'The Provincial Court dismissed the appeal of the CAM to pay the compensation of the Higuericas
The Bank will have to return the money that the owners gave on account towards the purchase of dwellings'...
Nearly 1,000 British families faced forced eviction proceedings last year (says The Olive Press). According to figures released from the College of Property Registrars, Britons accounted for 3% of repossession cases in 2012. In total across Spain, 30,034 first homes were repossessed by the banks in 2012 – or one every 12-and-a-half minutes – because of non-payment on mortgages. More than a third (36%) of these belonged to foreigners, with Brits accounting for 2.9%, Ecuadorians 8.8 %, Moroccans 5.5% and Romanians making up 2.8% of the home-owners...
The 'Tool house', a rather impressive luxury chalet of over 200 square metres built outside the town of Villamediana by Pedro Sanz, the President of La Rioja, and described by that Worthy as a 'shed', was originally to be found in rural land; but things have now been 'sorted' after the local town hall quickly voted in a new General Plan, which included the area where the controversial housing is located. Under other circumstances, the villa might have ended up as 'illegal' or without water or perhaps elecricity, so thank Goodness for common sense! (Story at El Plural)
IMF sees Spain’s jobless rate climbing to 27 percent this year – An article from El País in English. 'The agency now predicts that the Spanish economy will contract by 1.6 percent in 2013. After five years in crisis, the IMF on Tuesday predicted the Spanish economy would continue to struggle, with the recession deepening this year, accompanied by record levels of unemployment.
In its latest World Economic Outlook report, the International Monetary Fund forecast the Spanish economy would decline 1.6 percent this year after on top of a 1.4-percent contraction in 2012. A timid recovery is due to set in next year when GDP is expected to grow 0.7 percent. The IMF previously forecast GDP would shrink 1.5 percent this year and grow 0.8 percent in 2014.
The European Commission expects the Spanish economy to contract 1.4 percent this year, while the government’s official forecast remains for a decline of 0.5 percent, although the administration is expected to revise that figure when it presents its updated macroeconomic forecast on April 26.
One of the most discouraging aspects of the report is the IMF’s prediction that the jobless rate will continue to climb from 25.0 percent last year to 27.0 percent this year, before easing only slightly to 26.5 percent in 2014. A source at a central bank said that Spain so far had been able to bear the brunt of rampant unemployment because of the safety net provided by public subsidies and assistance from family members, but warned that these back-up resources are starting to run out'...
'No banker in the dock after four years of crisis and 55 billion in bailouts', leads an article in El Boletín. 'The financial crisis has obliged around 100 councillors and managers of the different banking institutions so far to sit on the accused bench in court – some of them as well-known to the public as the former Minister of economy and former manager of the IMF, Rodrigo Rato. However, so far, there has never been a single indictment.
'In the Palace, things go slowly' goes the Spanish saying, and in this case there seems to be very delicate issues to be resolved, with numerous political implications while at the same time causing an ever increasing social alarm, taking into account also that the financial crisis has forced the FROB – the restructuring fund provided by Brussels – to inject more than 39,000 million euros into Spain's banking system, in addition to the 13,869 million which the State already lent to the Cajas so that they could undertake their mergers'...
'More symptoms of economic recovery in Spain' (From La Marca España Government website): 'La Caixa believes that the recession is beginning to abate in Spain after the sharp drop in the fourth quarter of 2012.
The information provided by the Catalan bank La Caixa is derived from studies carried out by the bank, which believes that, although the light at the end of the tunnel can be seen, “we will have to wait until 2014 to create jobs”, as it will be at this time when the internal demand starts to gain a dynamic. Although the drop in economic activities has slowed and the expectations are that the economic deterioration will be reduced in 2013, there are still no signs of an improvement in the labour market.
The battery of measures of support for entrepreneurs and towards the creation of jobs for young people passed by the government “should contribute to the improvement of the labour market situation, which continues to show no signs of change at present.”
The experts at La Caixa – who consider that “the intensity of the recession reached its peak in the fourth quarter of 2012” - also mention those banks that, it states, will no longer have losses which affect public debt, due to the “advanced restructuring process of the financial sector”. La Caixa believes that 2013 will be a year in which the bank focuses on recovering the system’s profitability, and understands that “the process of adjustment in terms of capacity and costs in the sector should help to regain profit margin”.
The financial institution’s report emphasized that the largest fall has been in the construction sector, with an accumulated drop of 37% from the first quarter 2008. This means that the accumulated drop of the GDP since 2008 through the third quarter of 2012 was 1.6% (5.7% including construction). For this reason La Caixa is pressing for the stability of this sector in order to slow down the fall of GDP in the next few months'.
Where has all that black money gone? A reasonable question asked by El Mundo earlier this week in a leading article. In a series of 'bullets', the paper makes the following observations:
The underground economy is the equivalent of between 20 and 30% of the Spanish GDP 44.5% Of the population consider fraud to the second largest problem (after unemployment)
72% of fraud in the country comes from wealthy individuals or from large companies
The small and medium-sized companies account for 17% of tax evasion
The self-employed and employees are responsible for 8% of tax scams
Despite the fines (says El Mundo sorrowfully), ending fraud seems impossible.
The article points out that, while the Income Tax declaration (Declaración de la Renta) has to be taken by Hacienda as honest, the tax inspectors can nevertheless contrast the tax returns with other information they have to hand, like new car registrations, property movements, inheritance and so on. 'Modulos', a system of tax declaration based on 'estimates' of sale, are an opportunity for fraud. Of course, the large companies and those with private fortunes are able to hire tax-specialists who can 'sail just within the law' to obtain 'fiscal advantages'. 'Clever tax advisers can interpret the laws to their advantage, they say they aren't stealing, just planning wisely', says a tax inspector bitterly. This year, Spain will allocate 0,13% of its GDP to combat tax fraud: 1,328 billion euros.
World Asset Declaration:
A web-page with the petition highlighted in last week's Business over Tapas and other material is at Asset Reporting in Spain here. The Organisers say: 'Since it is an expressed concern, be assured every attempt will be made to ensure the confidentiality of the names of signatories if they wish public anonymity- simply ask to be shown as an “anonymous” signatory. Once the signatures are passed to Brussels they are confidential'. The signatures are already starting to come in. The petition has been registered with the EU Parliament as Nº 393/13.
A spokesperson from the European Citizens’ Action Service in Brussels has confirmed this week that 'We are in fact preparing both a complaint to the European Commission and a petition to the European Parliament that will be ready by Friday...'.
The ex-judge of the national audience Baltasar Garzón says that the money from the ex-treasurer of the PP Luis Barcenas found in several accounts of Switzerland 'shows he was in the right' when he decided to intercept communications between suspects in the Gürtel network and their lawyers, a decision sanctioned by the Supreme Court with his disqualification as a judge for eleven years.
"The interception was ordered to prevent the continuation of the offence of laundering of capital and the movements of illegal funds of which I already had indices of proof", Garzón said in an interview with the Colombian newspaper 'The Spectator'
"Four years later", Garzón continued, "I have been proven right when 22 million euros were found in a Swiss banking account belonging to Luis Bárcenas. Communications which were intercepted by me were between the top leaders of the criminal network with their lawyers and advisers, who were also charged in the same case".(From Nueva Tribuna): Wikipedia notes: 'Garzón has been prevented from working as a judge in Spain since May 2010. His initial suspension was the result of legal action initiated by a group called Manos Limpias (which has been described as "far-right") and the Falange. He apparently had infuriated elements of the Spanish right. Although he was suspended from judicial activity in Spain pending trial in respect of a charge relating to his investigation of Francoist crimes, he was given permission to work as a consultant at the International Criminal Court in The Hague for 7 months from May 2010.
In 2012 the Supreme Court of Spain considered three charges against Garzón. They found against him in relation to only one of the charges, that relating to his investigation of the corrupt, money-laundering "Gürtel" network. On 9 February 2012 the Supreme Court convicted him of illegally wire-tapping conversations between suspects (on remand in connection with inquiries into "Gürtel") and their lawyers who were believed to be moving their money beyond the reach of the court. The trial judge described this act as appropriate to a dictatorship and sentenced him to eleven years disqualification from judicial activity. The Court did not find against him in the other two cases'.
The Non Resident Certificate – 'People who are not a resident in Spain, and are the registered owner of a car with a Spanish registration, have to carry a non-resident certificate. Royal Decree 557/2011 of 20 April, which the Regulation of Law No. 4/2000 approved on the rights and freedoms of foreigners in Spain and their social integration, is governed by the amendments made by the Act 2/2009. This can be obtained from your Policia Nacional Office. You will need to check the office hours pick up the forms EX 15 and 790 and make an appointment. For the appointment you will need:-
A completed EX 15 form, and 2 photocopies, your identity card or passport with a photo copy, a photo and a photocopy of the NIE number. With the Form 790 go to the bank and pay 6.89€. Bring all the documents with you to the appointment. If one is resident in Spain, then one should transfer one’s foreign driving licence to a Spanish one'. From the Neighbourhood Watch ([email protected]).
There is a village in Barcelona with just 200 inhabitants, yet 60,000 cars are registered there. This is the case of Aguilar de Segarra which has 228 cars per person. The answer to this odd situation is that the Circulation Tax (impuesto de circulación) in the small village at 10 euros is a lot cheaper than in Barcelona City, at between 100 and 125 euros per family vehicle. For a rent-a-car company, there's a lot to be said for registering your fleet in some small dorp, like Aguilar de Segarra... (From Cadena Ser)
Spanish Copyright Piracy Laws to be toughened up (From ZDNet): 'Spanish Education and Culture Minister Jose Ignacio Wert hopes that a set of "anti-piracy" laws will be enough to take the country off the naughty list for copyright violators.
The European country is rife with pirates who joyfully download the latest episode of Game of Thrones or enjoy free access to games and music, and so is in danger of being placed on the U.S.'s "watch list" of countries that contain the most prolific illegal down-loaders.
According to Reuters, the U.S. government is due to publish the latest list of copyright violating countries this month. The International Intellectual Property Alliance (IIPA), a copyright lobbying group, recently released a report (.pdf) which suggested that Spain once again be placed on a priority watch list for both illegal downloads and the trade of copyright-infringing goods, even though the country was removed from last year's list. If a country is placed on the U.S. government's naughty list, then trade sanctions – and restrictions thereof – may be used to try and make the countries in question impose tougher laws to try and combat piracy'...
From a radical site called Raging Bull comes an article about the lost hope for Youth in Spain where the Writer finds himself in a protest march: … '... “No soy anti sistema, el sistema es anti yo” (I’m not anti-system; the system is anti-me). The placard was held aloft by a small child riding on his father’s shoulders. The cynical realist within me knew full well that the boy, who must have been no more than five or six years old, was merely channelling his father’s thoughts. But that didn’t stop my more romantic side from imagining that the child was, in actual fact, eloquently speaking out for his soon-to-be lost generation.
For if there is one thing of which you can be sure about present-day Europe, it is that its political and economic systems are not meant to serve or protect the interests of the youth;
on the contrary, they have been designed to gradually erode their last-remaining freedoms and rights and, by leaving them the tab for the transgressions and greed of the global banking sector, deprive them of all hope of ever attaining the standards of living once taken for granted by their parents or grandparents.
Spain is a perfect case in point: In the two intervening years since the country’s 15-M moment, the economy has spiralled into a bottomless depression. Official youth unemployment in the country has reached a mind-boggling 60 percent. Thousands of Spanish savers and pensioners have been robbed of their life savings, victims of the national banks’ cunning (and, it goes without saying, unpunished) preferentes sleight of hand
All the while, taxes continue to sky-rocket and essential welfare spending has been mercilessly sacrificed on the altar of bank recapitalisation'....
The Spanish Economy By Andrew Brociner. Andrew is away this week
The U.S. Immigration and Customs Enforcement (ICE) returned a 16th century tapestry, stolen in 1979 from a church, to the government of Spain at a repatriation ceremony at the Spanish ambassador’s residence in Washington April 17. The tapestry was seized by ICE’s Homeland Security Investigations (HSI) special agents in Houston after it was sold at auction.
The wool and silk tapestry was stolen in December 1979 from a national cathedral in Roda de Isábena, in the province of Huesca, Aragon, Spain. The tapestry depicts St. Ramon, the Virgin Mary with infant Jesus, Saint Vincent of Saragossa and Saint Valerius, used as an altar piece in the Romanesque cathedral. The tapestry was produced in the early 1500s and was part of the church’s collection when the cathedral was declared a national monument by royal decree in 1924. (From The Atascocita Observer)