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Weekly Report

Business Over Tapas (Nº 194)
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Business Over Tapas (Nº 194)

By Lenox Napier and Andrew Brociner – Sent by José Antonio Sierra (CCLAM)

sábado 04 de febrero de 2017, 02:54h

04FEB17.- 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. For subscriptions and other information about this site, go to businessovertapas.com - mail: [email protected] - ***Now with Facebook Page (Like!)*** Note: Underlined words or phrases are links to the Internet. Right click and press 'Control' on your keyboard to access. Business over Tapas and its writers are not responsible for unauthorised copying or other improper use of this material.

Editorial:

‘The Government aligns with the EU against President Trump but refuses to make any statements against the American leader. Rajoy and his ministers try to reject all of Trump's most contentious decisions but without drawing too much attention or by leading the European opposition to Trump’. Headline at El País. Spain’s foreign minister, Alfonso Dastis, is having to tread particularly warily as the new foreign policy of the USA is causing both surprise and concern worldwide; ‘of course we must worry’, he admits... the unwillingness of Spanish officials to criticise Trump too loudly is also covered in a story at The Olive Press, which says ‘The Spanish government has refused to condemn Donald Trump’s ban on immigrants from seven Muslim-majority countries. A PP spokesperson said it wanted to avoid ‘shouting and being too strident’ in its relations with the new US president... However, as The Local notes, this reticence is not always being observed: ‘The mayor of Madrid has compared President Donald Trump to Hitler over his travel ban on seven Muslim-majority countries and suspension of the arrival of Syrian refugees...’. We must accept that Donald Trump and his politics are going to continue to surprise the rest of the world for the next four years, and we also suspect that the new American president will not gladly allow insults or criticism of his policies from abroad. But provocation towards Hispanics there certainly is – beyond the current slight aimed towards Mexico. As the Eye on Spain reminds us, ‘the White House website's page, Twitter account (now returned) and Facebook site in Spanish disappeared within two days of Republican leader Donald Trump being sworn in as president, despite the USA having more Spanish speakers in residence than the entire population of Spain...’. Not, of course to say that all the Media in Spain is keeping their entirely opinion to themselves, as, for example, here at Nueva Tribuna with their report: ‘Ten days that shamed the World – Trump degrades the American Democracy’.

Interesting times then.

Housing:

Soon, an old lady will be evicted because, as she says ‘they want to build new houses here’. The story and a video at Andalucía Información: ‘Josefa Márquez, an 84 year old widow living in Jeréz de la Frontera, who has been in the same house for almost 40 years – a home she built with her family – has until March 13 to leave. Her daughter, who lives next door with her husband and two children, has a similar sentence on her property...’. The case is said to revolve around the homes being deemed ‘illegal’. The video, recorded by the old lady, has gone viral.

‘...There’s a lot to like about Valencia. First, there’s the location and climate. It sits right on Spain’s eastern Mediterranean shore. That means urban beaches and a temperate climate that is spring-like much of the year. Next, it’s a major city—Spain‘s third-largest—with all the big-city amenities I like, including an international airport, plenty of culture (it’s especially famous for music), and great restaurants, bars and cafes. Yet Valencia is reasonably small—about 810,000 in the central city and around 1.6 million in the urban area—so it’s manageable. A big city in a small package, with sandy beaches and warm Mediterranean waters to boot? Hard to beat, in my book. And the icing on the cake is the affordable real estate...’. From an article about moving to Valencia in International Living.

Tourism:

The final score for tourists visiting Spain in 2016 (slightly massaged as these things always are) is 75,600,000 all told. This is 10.3% up on 2015. British visitor numbers were up by 12.4% says El Español here.

Are there too many tourists in Barcelona? Here’s Biznob: ‘Banners waved high along with the chant, “Barcelona is not for sale” rang out through the city as more than 2,000 citizens marched through the city streets in protest. There were also chants of “We will not be driven out” throughout the Rambla, Barcelona’s famous boulevard. Nearly 40 community and residential groups from all over took to the streets. Even though the number of tourists has grown exponentially in the last year, the protest wasn’t just directed at mass tourist spots. It’s reported that in 2016 nearly 9 million people occupied hotels and another 9 million stayed in holiday apartments. Not to mention 12 million people arrive in the city by car, cruise, or train...’.

Seniors:

From Bloomberg: ‘It’s not just British and German pensioners who enjoy living in Spain. Spanish retirees saw a boost in both their incomes and their net worth between 2011 and 2014 while working-age families bore the brunt of the nation’s worst economic crisis in modern history. That’s according to a study by the Bank of Spain this week analyzing households’ finances. The study illustrates how Prime Minister Mariano Rajoy succeeded in shielding his core supporters from the effects of the financial crisis after he took power in 2011. While his government cut public salaries, slashed spending on health and education and introduced more flexible labour laws that helped to drive down wages, he also raised pensions and maintained health programs for the elderly...’.

The Region of Madrid has now begun to send ‘therapy dogs’ to schools, hospitals and retirement homes in a program called ‘el Servicio de Intervención Canina’. Animals can often elicit reactions in those who have problems in communication, or are in other ways isolated. The report is at Entre Mayores here.

To those who listen to Spanish radio, there’s a dedicated weekly program for Seniors called ‘Juntos Paso a Paso’ Saturday mornings 7.00 to 8.00am here on Radio Nacional de España. The BoT contributor José Antonio Sierra will be interviewed on the show on February 11th.

Finance:

‘Employment once again grew strongly in 2016 despite the fall of jobs in the public sector. The labour market created more than 400,000 jobs last year and the total number of unemployed fell by 541,700 people’. Headline at El País. Where is the unemployment highest? There’s an interactive map in this report.

Headline from El País in English: ‘Spain’s Bankia to refund all clients over “abusive” mortgage clauses. The bank has set up “express repayment process” it says is in its best interests and those of customers’. The story is also covered by El Diario here.

From Mark Stücklin’s Spanish Property Insight comes a different story: ‘A Government Decree rushed through last week setting up an extra-judicial process for settling mortgage interest floor-clause claims does borrowers no favours, and makes it more necessary for foreign borrowers to group together behind a Rottweiler legal team to get the best settlement. On Friday 20th January the Spanish Government passed a Royal Decree 1/2017 setting up an extra-judicial process (EP) for settling mortgage interest floor-clause claims against lenders, ostensibly to make the process quicker and cheaper for both sides, and avoid clogging up the courts. In reality, the Decree tilts the playing field in favour of banks at expense of borrowers...’.

The BBVA has reported a profit in 2016 of 3,475 million euros. Story here.

Bankinter reports a profit of 491 million euros in 2016. The spokesperson for the bank María Dolores Dancausa said in a recent speech that ‘we bankers are not the greedy folk seen in Mary Poppins. We finance dreams’. It probably sounds better in Spanish.

Blackrock is now the largest shareholder in Telefónica with shares worth some 3,000 million euros. They are also heavy in Orange and Vodaphone. Who are Blackrock? Meet them here.

Hacienda, in its search for more taxes, is turning its gimlet eye on the Chinese bazaars, says El Independiente here. We learn that the merchandise is often reported at Customs with an artificially low value... Indeed, enormous amounts of Chinese products never make it past the Customs inspections as it is... Customs discovered, as an example, a total of 185,838 fake fashion-brand clothes imported from China last year.

It looks like the AVE stretch from Granada to Almería won’t be ready until 2030, according to a MEP called Clara Aguilera, taking a poke at the Government. She may be right. Ideal has the story here.

Politics:

As the upcoming Podemos congress known as Vistalegre II (a hall in Madrid), with its leadership struggle, occurring this weekend, is receiving much press coverage, the PP quietly has its own congress this Friday through Sunday also in Madrid. Meanwhile, the recent Ciudadanos primaries ended with Albert Rivera continuing as leader of the group with a support of almost 90% of the delegates.

Podemos has just donated 500,000€ to charities – money which comes freely donated from what they see as unnecessary over-payments to their elected politicians. ‘It’s returning to Society a small part of its property’, the party insists. Story here.

A Granada doctor called Jesús Candel, now nationally-known under his nickname of ‘Spiriman’, has managed to stop some major cuts in the Granada health service through his well-supported protests and public meetings against the proposed health cuts of the Regional Government over the past few months. He even - apparently - caused the resignation of a senior health official in the Junta de Andalucía. El Español reports.

Without any knowledge in particular about electricity, the latest board member of the ‘Red Electrica de España’ is another retired PP politician, the ex-head of the Guardia Civil Arsenio Fernández de Mesa. Story here. A poor choice? This opinion at Público thinks so.

Corruption:

A story that’s raising eyebrows internationally: The funcionario – public employee – who had turned up to work every day in Valencia, clocked in, and then disappeared until checking out time. For ten years. 45,000€ a year he gets. Why is no one here very surprised?

Catalonia:

The Government has a plan to close down all the polling stations in Catalonia on the day of the referendum – which may be celebrated before summer. It’s not going to end well.

Brexit:

From El País in English: ‘Spain ranks third as the preferred destination for global investors looking to relocate out of the UK and into other European countries, according to a new survey released on Tuesday by EY. The audit firm (formerly Ernst & Young) asked senior business executives representing firms with foreign investments in Europe about the impact of Brexit on their operations. And 14% of respondents said that their company is planning to relocate operations if the United Kingdom leaves the European single market...’.

From The Independent: ‘British citizens may lose their right to free or subsidised medical treatment when they visit the EU after Brexit, the Health Secretary has admitted. Jeremy Hunt told MPs he could give no guarantees that the European Health Insurance Card (EHIC) will survive EU withdrawal. Giving evidence to a Commons committee, Mr Hunt agreed that the card was “a very positive thing” but warned any decision on its future must await the final Brexit deal...’. Article and video here.

‘The PSOE spokesman in the Foreign Affairs Committee, Ander Gil, has registered in the Senate a motion in which he calls on the Government to guarantee the maintenance of the rights of Spanish residents in the United Kingdom following Brexit. This initiative will be discussed at a forthcoming meeting of the Foreign Affairs Committee of the Upper House.

In this regard, Gil emphasizes the need for a comprehensive 'ad hoc' study to be carried out, which includes a statistic of the actual number of Spanish residents in the United Kingdom, as well as of their administrative situation in that country and, in parallel, a study of the circumstances of British residents here in Spain...’. More in Crónicas de la Emigración.

Media:

An angry opinion piece, here in El País in English, discusses the ‘Threats to the freedom of the press’. Valid points are raised, although the article forgets that El País is one of the daily newspapers in the group that supports the ‘Canon AEDE’ which calls to limit news-sharing by aggregators. The article raised the disturbing point that ‘...In its 2015 report on this area, the CIS public research institute found that Spaniards only gave the media a score of 4.28 points out of 10 in terms of credibility. Some 15% of the population never or almost never trusts the media, compared to 2.5% who always or nearly always do so...’. Are newspapers, always run these days by large commercial companies, allowed the full editorial freedom they need?

La Verdad de Alicante – part of the Vocento group – has closed. This daily newspaper had been going since 1963. More here.

A Swiss study forecasts the end of print newspapers by 2021. A fall in both daily sales and, of course, advertising, is pushing print newspapers ever nearer the brink. Story here at Media-Tics.

Economics:

The Housing Sector: prices, continued

by Andrew Brociner

Last week, we began our assessment of the housing market in Spain by looking at prices. So far, it looks like if there is any increase, it is modest, and it appears that we are still in a period of consolidation.

According to Tinsa, the latest figures show that while prices rose slightly in Spain, at 0.8% annually in the last quarter of last year, they still show great disparities across regions. For instance, the two regions with the highest increase in prices are Cataluña at 7.2% and Madrid at 5.2%, with mainly the provinces of Barcelona and Madrid driving this increase. The Baleares, which showed the greatest increase this time last year, is now registering decreasing prices again, at -3.1%, so it did not sustain its initial move. Some of this demand it seems came from speculation, buying at low prices with a view to rent, given the large tourism demand in the area, and also given the shortage of housing available for that objective; the recent clamp down on rental housing might have something to do with this dampening of demand lately. As for the two regions of Cataluña and Madrid, which are showing an increase, it is worth keeping in mind that they are also the ones which showed the heaviest decrease following the boom, so these regions were catching up starting from a relatively lower point. Next in line are the Canaries, with 2.8% and Andalucía with 2%, but here too the provinces of Málaga and Almería are accounting for a great deal of this increase, with some regions still decreasing.

Indeed, if in Andalucía, Málaga and Almería showed an increase last quarter, Seville, Granada and Huelva are still decreasing. As for the coastal provinces, while Barcelona and Valencia show increases, Alicante and Murcia are decreasing still. The picture is quite mixed at this stage, between some provinces across Spain picking up while others continue to decrease.

And if we look at the capitals, they too tell a similar story. Some capitals in Spain have bottomed out and have now price increases, among them Barcelona, Madrid and Málaga. Barcelona, which bottomed out in 2013, has shown constant gains since, while Madrid, which bottomed out in 2015, has shown more modest gains. Málaga too, which bottomed out in 2013, is showing some positive gains, while Valencia, after bottoming out in 2015, has shown some gains as well. On the other hand, some capitals have not yet bottomed out, among them Seville, Córdoba, Granada and Murcia, with prices still decreasing since the end of the boom, and now having accumulated a decrease of 45% or more.

These regional differences tell a story of contrasts, with some picking up, while others still decreasing long after the boom has ended. It really is a mixed picture at this stage with the country overall therefore still consolidating.

Various:

The Metro Line 8 to the Madrid airport is closed until April 18 for repairs.

‘Carrefour has announced plans to eliminate paper receipts in Spain. The supermarket giant will give its customers the option of receiving a digital version through its Mi Carrefour app, which allows customers to select a ‘no paper’ option when purchasing goods or using discount coupons. The move is part of its Papel 0 initiative which intends to systematically eliminate the use of paper receipts...’. Story at The Olive Press. All very commendable – like charging two cents for the plastic bag (although, they could have moved to paper bags, like the Americans...).

The Corner brings us ‘The Crazy Rise in Spanish Households’ Electricity Bill’ here.

Letters

Hi Lenox, Re IMSERSO, despite the wonky website (here) it's well worth persevering and registering. They do subsidised out-of-season stays in hotels on the Costas, Balearics and Canaries that would otherwise be closed or underused. We've done several now and have had a great time. (Ibiza just before Easter was particularly good). An example: we're staying for a week in Roquetas in Feb. for 203€ each we get the return flight from Madrid (plus transfers) and full board including wine with all meals, well, except for breakfast; you can't always have everything.... Saludos, Jake

Finally:

Rumba Flamenco performer, sings ‘Una lágrima cayó en la arena’. On YouTube here.

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