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Business over Tapas
Spain Today by Lenox Napier
Business Over Tapas
A digest of this week's Spanish financial, political
and social news aimed primarily at Foreign Property Owners:
with Lenox Napier and Andrew Brociner
email: businessovertapas@gmail.com
Note: Underlined words or phrases are
links to the Internet. Right click and press 'Control' on your keyboard to
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Business over Tapas and its writers are not responsible for unauthorised
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25 February 2016 Nº 149
Editorial:
By the look of
things, the month of June should end in an interesting way. First we may see
the end of the UK’s membership in the European Union, depending of course on a
referendum to be held on Thursday June 23rd. Not many of the two million or so British
expats that live in Europe (who might be expected to be the most affected by a
‘Brexit’) will be voting in this exercise. In Spain, we British expats are
anything between 270,000 (the INE figure) and 800,000 (preferred by the British
media). If there is a Brexit, and Britain exercises its sovereign rights to
penalise in any way those EU foreigners who live or work or study there,
withdrawing from them any of their privileges hitherto afforded a citizen from
a fellow member-state, then we can be sure that the Spanish authorities will
retaliate (especially if they accept the INE figure as gospel). We have no
spokespeople; we have no representation; we have no champions. Will a ‘Brexit’
occur? Probably not – but our existence will have no sway on the reasoning behind
the vote. Britain may have sent a fleet to save 2,900 Falkland Islanders, but
it won’t lift a finger for its expats.
The second event
pencilled in for June is a probable General Election in Spain. The PSOE and
Ciudadanos have arrived at a deal which will be presented to Parliament on
March 1st and 2nd. This deal does not have a majority backing and, in a second
vote three days later, on March 5th, it will almost certainly not be accepted
thanks to abstentions from the PP and Podemos – the two parties who (perhaps
unrealistically) think that they stand to gain more support from a fresh
election. The date for this would appear to be June 26th.
…...
Housing:
‘Cost of living in
Spain: gulfs between cities revealed. New research has highlighted sharp differences
in the prices of properties, goods and services in the country, which is home
to 770,000 British expats...’. The
Telegraph reports
on the variable cost of living in different cities in Spain (most expats live away from the cities in
small towns or villages).
‘According to a
recent report published by Bankinter, the demand for housing in Spain will
continue to grow, reaching up to 420,000 home sales in 2016 and up to 450,000
in 2017, and that the price increases shall not exceed 3% on average, or 5% for
those in the best locations...’. More
at Kyero.
The British pound is
falling against the euro following the announcement of the Mayor of London that
he will be supporting ‘Brexit’ in the referendum to be held on June 23rd. This
will no doubt affect sales to British buyers in Spain.
…...
Tourism:
Andalucía: again, those
rules for renting out your spare room, or apartment. This time, the list
comes from Andalucía.com blog. Is
this new law designed to protect the tourists, or is it rather to protect the
Big Players in tourism from small-scale competition? (I wish I knew). By the way, the full 6,200 word rule from the
Junta de Andalucía (en castellano) is
here.
…...
Finance:
Hacienda is
pleased to report that they managed to recover an extra 15,600 million euros in
2015 in their efforts against tax-evasion: 27% up on 2014. The story at El País here.
One way to attract
investment is for the authorities to boast of how cheap employment costs are. Wages
are very low here in the Canaries, says a promotion for bringing industry to
the region. Workers receive 2,104€ gross average against 2,580€ across Spain.
The Canary Government should be working for better wages, not cheaper ones, says
the local leader of Podemos with some justification. Story here.
While we don’t see
many 500€ notes here at Business over
Tapas, it appears that 75% of all money in circulation in Spain is with
these bank-notes: or 34,000 million euros. A spokesperson for Hacienda says
that around a quarter of all business in Spain is now ‘black’ and a small stack
of 500€ bulls is just the ticket...
…...
Politics:
The PSOE leader,
Pedro Sánchez, has come to an agreement with Ciudadanos to suggest a minority government
in the Cortes (now
rescheduled) on March 1st. The agreement must first get past the PSOE
militants. The coalition would need a majority vote (impossible), or, the
following day, a simple majority with abstentions from the other parties
(unlikely). Sánchez is nevertheless looking for other party support to
strengthen his hand. Reports from El
Huff Post here
and El Mundo here.
Podemos says
it won’t support any agreement with involves either Ciudadanos or the Partido
Popular. If all fails, a whispered comment from Mariano Rajoy to Britain’s
David Cameron suggests
fresh elections for June 26th.
The other parties
who have been negotiating with PSOE – of course Podemos, but also IU and
Compromís – have all broken
off talks with the socialists.
Juan Martínez
Majo, the President of the Diputación de León, is one senior PP politician who
thinks it is time for Mariano Rajoy to give way to a new leader within the
party as candidate for president. ‘Rajoy is a great leader, but perhaps he
should give way to allow a strong government with a broad consensus’, he says
in a radio
interview.
Mariano Rajoy has been
declared as a ‘persona non-grata’ in his home city of Pontevedra. This
embarrassment comes from Rajoy green-lighting the continuation of a smelly
wood-pulp factory in the city, located on public ground, for another sixty
years...
The group called
Manos Limpias (Clean Hands) is an association that spends most of its time in
litigation – against Podemos, the princess Cristina and anyone else that
offends it. It is a far-right group that is now seeking to form a far-right
political party along the lines of France’s Front National since ‘we can
attract the support from the disenchanted conservatives and nationalists from the
Partido Popular’. A suggestion is to call it ‘Federación Identitaria Española’,
says Público here.
The Junta de
Andalucía and the acting Madrid government are in
agreement. After ten years of litigation and time-wasting, the Hotel
Algarrobico (Carboneras, Almería) must come down. The costs will be seven
million in demolition and the possible compensation to the owners of a further
70 million. Greenpeace says: ‘not one penny must go to the builders’. Here
are some other algarrobicos sullying
the Spanish coast, says El Diario...
…...
Corruption:
From
El País in English: ‘Unease grows
among ranks of Popular Party over corruption cases. The continuing corruption
cases affecting the Popular Party (PP), and the leadership’s response to them,
are creating a climate of discouragement in traditional conservative bastions
such as Madrid and Valencia. “How do you explain this to people?” said one
high-placed member of the Valencian PP bitterly...’.
The acting
Interior Minister, Jorge Fernández Díaz, wonders ‘with all due respect to the
judiciary, why are just PP corruption cases being discovered and discussed by
the media?’ Story
and tape at La Razón. The reaction
was swift: ‘Judges and police react against the accusation of partiality on the
part of the acting minister’, says
El Boletín.
The ABC (conscious of the corruption within the PP) has an
article about the PSOE-Andalucía, where it bewails the 275 accused and none
sentenced in the ERE Case. ‘The PSOE benefits from this long drawn-out and
badly handled case’, says the newspaper.
‘An average of 5
people every single day were arrested last year on corruption charges. A
whopping 7,140 were nicked during the last term of government for doing things
they shouldn’t whilst in power. And the very way that fact was released today,
with the current political situation in Spain, sort of shows that the mindset
hasn’t changed. 2,442 of these were taken down to prison last year alone. As
for organised crime, 69,000 have been investigated over the last four years of
which 25,000 were arrested...’. More
on this at David Jackson. A similar
story in the ABC here.
In another report, El País has a
graphic of the cases of fraud within the social security system.
The previous
vice-mayor of Valencia Alfonso Grau (and right-hand of Rita Barberá) was
arrested on Monday by the Guardia Civil as part of the inquiry into the
PP-Valencia for corruption and money-laundering.
China on Thursday
urged Spain to "safeguard the legal rights and interests" of
employees of Chinese megabank ICBC, following their arrest by Spanish
authorities on suspicion of laundering tens of millions euros. Spanish police
searched the Madrid branch of ICBC on Wednesday, arresting five of its
directors as part of a probe into the suspected laundering of at least €40
million. "We hope that the Spanish side would deal with the relevant issue
in accordance with the law and honestly safeguard the legal rights and
interests of Chinese companies", foreign ministry spokesman Hong Lei said
during a regular press briefing...’. Story
at The Local.
The disgraced
mayor of Alhaurín el Grande has finally stepped down after years of corruption.
Juan Martín Serón finally accepted his days were numbered after a vote of
no-confidence was tabled for this week by all rival parties, including the PP,
PSOE and the IU. Story
at The Olive Press. Another mayor to
go this week is Rogelio Mena from Albox in Almería for procedural
irregularities. .
…...
Catalonia:
‘The president of Catalonia, Carles Puigdemont, vowed to press onward
with his government’s diplomatic efforts, stating that Raül Romeva will
continue to serve as Catalonia’s minister for foreign affairs. Puigdemont’s
statement comes after the Spanish constitutional court’s suspension of the
Catalan foreign ministry following the court’s agreement to take up the
challenge brought by the Spanish government...’. From
Vilaweb.
…...
Andalucía:
An interesting article
at El Confidencial asks why
Andalucía is such a hopeless mess, with high unemployment and little chance of
improving things – yet so stuck in its past. ‘...in Andalucía, if you don’t
have a god-father, you don’t get ahead. It happened in the XII Century, it
happens now...’.
…...
Courts
The Supreme Court
rules that the Hotel Algarrobico was built on non-urbanisable land. The story
plus video at RTVE here.
How to stop the
lawyer and accuser of Princess Cristina from asking questions in court in
Palma? Why, you could accuse the lawyer in question, Virginia López-Negrete, on
the same day, at the same hour, in another court in far-off Madrid. The sorry story
at El Español. Indeed, the only
thing that would be worse would be a recent picture of the chief prosecutor
sharing a glass of wine with the lawyers for the defence. But, wait, what
is this?
The ex-President
of the Caja Castilla La Mancha (and
ex-deputy for the PSOE) Juan Pedro Hernández Moltó has been sent
down for two years for improper banking practices.
…...
Brexit:
‘British expats in
Europe have stepped up their campaign to stay in the EU amid fears that a
Brexit would see them lose key rights and benefits overnight. There are thought
to be more than two million UK nationals living across the EU. As long as
Britain remains in the union, they have their pension and health care rights
protected. They also have the right to live, work and own property in Europe,
and claim social security benefits. However, in the event of a Brexit, these
advantages would be up for renegotiation – possibly on a country by country
basis – leading to months of uncertainty...’. From
The Telegraph. The referendum will
be held on June 23rd.
‘What will happen
to the estimated 2.2 million Brits who live in the EU, and the further one
million who own holiday homes there?’, asks
A Place in the Sun (interesting conclusions).
The BBC asks: ‘UK
and the EU: Better off out or in?’ In a rare nod towards the expats, there is
even a small section titled: ‘What would happen to Britons working in Europe,
and EU citizens working in the UK?’.
‘Withdrawal from
the European Union’ – a useful post at Wikipedia
on the rules here.
Breaking News: Summary of the Overseas Voters Bill 2015-16. ‘A Bill
to make provision to facilitate an increase in the registration of voters
resident overseas who are eligible to participate in United Kingdom
Parliamentary elections; to extend the criteria for eligibility to register as
an overseas voter; to enable those registered as overseas voters to cast their
votes through use of the internet; and for connected purposes’. This Bill is
expected to have its second reading debate on Friday 26 February 2016. From
Parliament.UK
Finally (at the
risk of over-reporting this subject), here
is a rare article from the expat press about what might happen to the British
living in Europe. It comes from the French freebie called Connexion.
…...
Various:
Spain is the
European country that has seen the highest increase in CO2 production – up 4%
over 2014 – says
El Ventano, and lists the names of
the biggest polluters, starting with Endesa, followed by Gas Natural Fenosa,
EDP España, Repsol, ArcelorMittal, Cepsa, Viesgo, Iberdrola, Cemex, Petronor (a
branch of Repsol) and Cementos Portland.
The British Spanish Society in London celebrates
its centenary today (Thursday).
The unused airport
at Ciudad Real is for sale. It cost 450 million to build, and it could be yours
for just fifty million. Story at El Mundo here.
The Catholic
Church in Spain has had
enough: the cranes that make their nests on church towers are threatening
the state of these sometimes delicate attachments and the Church wants them
gone. Unfortunately, the Law is with the birdies, and it is far from easy to
have their nests removed.
An interesting new
magazine and website has started in Spain, aimed at the elderly. Twelve million Spaniards are over sixty years
old. Welcome
to Senioradvisor.club.
Oops: the Matrera
castle in Villamartín (Cádiz) has got a remarkably poor repair (picture).
Benidorm,
evidently worried about its British and Irish visitors looking the wrong way
when crossing a street, has painted ‘Look Left’ on its zebra crossings. ‘...Council
chiefs in the Spanish city said the idea is to reduce the number of accidents,
especially at night-time when holidaymakers who have had too many drinks look
the wrong way before crossing...’. The story comes
from The Daily Mail.
Spain...? or
Portugal. ‘The Portuguese Non-Habitual Residency status enables those who
become tax resident in Portugal, and are accepted as NHR, the opportunity to
receive qualifying income tax free both in Portugal and in the country of
source of the income.
The NHR regime
represents a major step forward in making Portugal a tax free jurisdiction for
individuals in receipt of qualifying non-resident income. Qualifying income
includes pension, dividend, royalty and interest income...’. From Non-Habitual Residents here.
…...
See Spain
The insider's guide to the best wine bars in Barcelona: from The Local,
here.
‘Spain has its fair share of Mediterranean passion, spice and beauty —
not to mention some of the most gorgeous sunsets, natural parks and villages on
the planet. I should know: I met and fell in love with a Spaniard on the dimly
lit streets of Seville, elbow-to-elbow as he ordered me new foods or we zigzagged
the country in his car...’. Five romantic holiday spots in Spain, from
Sunshine and Siestas.
…...
The Housing Sector: Sales
by Andrew Brociner
We have been
looking at the housing sector and have seen that as far as prices are
concerned, although there are significant regional differences, we are still,
on a national level, consolidating. This week, we begin to look at some of the
factors behind the prices and we begin by house sales.
If we look at the
total of houses sold, both old and new, for the nation as a whole, we can see
that house sales are perhaps beginning to pick up slightly, but are still
generally quite low. If we compare this to the boom period, in 2007 an average
of over 64,000 houses were sold a month, with a peak in one month of over
83,000 units. In 2008, this was already down to 46,000 units a month and by
2009, to 34,000.
Demand continued
to decrease after that. The years 2012, 2013 and 2014 showed a remarkable
steadiness at about 26,000 units sold on average per month, but at this point,
sales were about one third of what they were during the boom. In 2015, 29,500
units were sold on average a month. It appears that, as with prices, we have
bottomed out and are possibly at the very beginning of an increase. But also as
with prices, we are a long way away from where we were. In addition, in the
last three months of 2015, sales tapered off again. Of course, at this stage,
we need to see more data to assess whether there is really an increase taking
place.
We could look at a
few regions as we did when we considered housing prices to examine the issue
further. Looking at Andalucía, we see that we are still inside a range that we
have been witnessing for the last five years. This is similar to the nation as
a whole. We definitely need to wait for the 2016 numbers to see if we break out
of this range and to assess whether sales are showing any trend.
If we look at the
regions of Cataluña and Madrid, we find that sales are picking up somewhat,
although as we have seen, the prices in these two regions plummeted so far that
people seem to be capitalising on low prices.
Here we can see
that there are some signs of an increase in house sales, especially in
Cataluña. However, while the number of house sales for the two regions are
quite similar, houses sold in Madrid are at one half of what they were during
the boom, whereas in Cataluña, they are still at one third.
Looking at data
for the Baleares, we note an increase in house sales taking place and, as we
have seen, in prices as well.
 |
While this region
does show signs of an increase, at 3% of the total sales, it is too small to
make any impact on the nation as a whole. Again, it would be better to see if
this increase will be sustained.
House sales are
reflecting the movement in house prices to a certain extent: the national
average is still flat and so are the prices. Andalucía is representative of
this national average with both sales and prices more or less on par with the
nation as a whole. In Madrid and Cataluña, some more sales are taking place and
it is in those two regions where the price increases are above the national
average, but again, their decreases after the boom were greater. The Baleares
are also showing signs of an increase in sales, but the region represents only
3% of total national sales.
The data on sales
confirms what we have seen on the price of housing, that we seem to have
bottomed out in 2014 and are starting to pick up slightly in some areas, but as
the housing market in Spain is heterogeneous, with some areas showing growth
while others continue to decline, we are still in a phase of consolidation
overall.
…...
Letters:
Death knell rings
for unregistered tourist properties in Spain. In reality it's another death knell
against tourism - do these "not very clever people" know the effect
of withdrawing 400,000 beds from the (already declining) (up) market tourist
business, as their owners take fright?
Do they not
understand that the issue is about collecting taxes and not about shutting down
tourist accommodation facilities? Doubtless as a result of some of these
stupidities some of us around the Marina Alta are now suffering the worst
(fully legalised) holiday bookings for 20 years. But all these non-tax-paying
rental properties in Andalucía are on websites (Hello! Do they know that this
is where the business is generated?).
All that is needed is to set up small offices and use the web to start
calling and/or e-mailing their owners.
This would produce
immediate reactions (producing volumes of work greater than the monoglot, and
"not very clever", Hacienda could possibly cope with!) - but, more importantly,
not a single tourist would be stopped coming to Spain.
If tourists cannot
find villas they do not go to hotels with their families (far too expensive) -
they go to another country!! Will these
people ever understand?
Hassled for
unnecessary repetition of cedulas
(every 5 years and at a scandalous price) - the doubling of basura taxes in under 5 years - crooked
activities by the public services (we all know who they are) .... I, too, will
leave Spain when I can.
There's always
something stupid being done - but no surprises here, as there are a lot of not
very clever people around..... and do we not read that Andalucía is No.2 in the
Spanish corruption stakes (after Murcia) ?
And they are getting caught, so clearly they ain't very clever
..... Q.E.D.
In
despair...................
John D
Lenox,
Good morning.
Now that the die
is cast, will you be advising your readers how to vote in the up-coming
referendum? By how, I mean what steps must one take to have the vote, assuming
that there are some residents who haven't been resident for 15 years.
It would be a
catastrophe for the expats to ignore what could be life changing decisions by
omission.
This is the
country we have chosen to live in and enjoy the culture and language.
It is in our
interests to make our views known at the ballot box, by post or proxy.
We must not allow
the disinterested majority to put our futures in jeopardy.
Tony.
…...
Finally:
‘Forget the
Macarena - it’s time to update Spanish music’s international rep’. Article and
music links at the El País
English-language blog Trans-Iberian here.
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