As the polls closed on the evening of 27th June, Pablo Iglesias, the pony-tailed leader of the far left Podemos party, could be forgiven for picturing himself in the Moncloa Palace as the new Prime Minister of Spain. In the weeks leading up to the elections the opinion polls had his Unidos Podemos electoral alliance firmly in second place, clear of the Socialist PSOE and gaining on the conservative People’s Party (PP). The sum of Podemos and PSOE looked likely to exceed the 176 seats needed for a majority. And with his party as the largest force on the left, Iglesias would have had a strong claim to occupy the boss’s seat in a left-wing coalition. The corks started popping at the Podemos HQ when at 8pm the exit polls seemed to confirm the earlier predictions. But election results come in quickly in Spain, and by 10pm, with 10% of votes counted, things looked very different. In short, all the polls were wrong. The PP confounded the pundits by gaining nearly 700,000 new votes and 14 seats. Although still some distance from an overall majority, the party currently running the caretaker Government increased its lead over the PSOE to 52 seats. The PSOE crucially held on to second place, losing 5 seats but just 100,000 votes. Podemos had a disappointing night. Their electoral pact with the communist IU failed to provide the hoped-for lift, and despite maintaining their 71 seats, they shed over a million votes. The centrist Ciudadanos lost 8 seats to finish with 32. While the PSOE could at least console themselves on holding off the challenge from Podemos, it...
On first arriving to work in Madrid in the early 90’s, it was impossible not to be struck by the abundance of bars. It was said that Spain had more than the rest of the European Union put together – true or not, it certainly felt like it. But it wasn’t just bars you would come across as you walked around Spanish cities – banks were also everywhere. This was the time of rapid economic growth. House prices were booming, and banks cheerfully handed out cheap mortgages to win new customers. And in the pre-internet age, the quickest way for them to grow their business was to open branches. The British tried to get in on the action – Lloyds, Barclays and Nat West all had branch networks. None of them do now. Lloyds sold out in 2014 before reaching its 100th anniversary in Spain, while Barclays, which at one point had nearly 600 branches, sold its network to Caixabank in 2015. Barclays had for many years made decent profits, but competition, the economic environment and some bad decisions led to large losses, and the group pulled out. From this…… A lot has changed in Spanish banking since then. Consolidation has been going on over the last three decades, but the recent banking crisis and property crash have accelerated the trend – five years ago there were 55 banking groups: now there are just 14. And there’s more change to come. Spain is still over-banked, with some 70 bank branches per 100,000 adult residents, almost double the ratio in France and nearly three times the UK figure. Not surprisingly, branches are...
Take a look at the official web-site of the pro-secession Junts pel sí (Together for Yes) electoral platform, and you’ll come across a stack of arguments to justify Catalan independence. It paints a country which, freed from the shackles and financial burden of belonging to Spain, would be a model of growth, with world class infrastructure, education and health systems and generous pensions – a kind of Denmark on the Med. All this would be paid for with the money that would no longer be handed over to the rest of Spain. If it all sounds too good to be true, that’s probably because it is. Things would not be quite so easy. To start with, it is not clear that Junts pel si and the CUP will be able to deliver independence to their supporters. And if they do, the economic outcome will be very different from what they have promised. Six weeks on from the ‘plebiscite’ elections, Catalonia still has no Government. Artur Mas, the former Catalan president and the Junts pel sí candidate – has yet to convince the anti-capitalist and fiercely pro-independence CUP to support him for President. He has until 10th January to do so, otherwise new elections will be called. Nobody among the secessionist groups wants that, so an agreement is likely. Meanwhile, the process continues and last week the newly formed parliament passed a resolution announcing the start of a unilateral process of ‘disconnection’ from Spain. This is a brazen challenge to Spain’s Constitution. The Spanish Government’s starting point for its defence has been the Constitutional Court, which has provisionally ‘suspended’ the resolution from the Catalan...
