Catalonia's Non-Binding Independence Vote Contributes to Spanish Government's Woes

On 9 November, Catalonia held a “consultation of citizens” on the political future of Spain’s wealthy north-eastern region. Catalonia did not hold the independence referendum that had been planned as it was blocked by the Spanish Constitutional Court. The vote took place as the Spanish government and key political groups are facing heavy criticism for a series of corruption scandals.

Although the Catalonia vote had no legal backing and despite the pro-unionists boycott, more than 2.3 million people participated in the unofficial vote with an estimated participation rate of 37%. More than 80% of poll participants voted for full independence, 10% opted for the region to have greater power within Spain, and 4.5% voted to maintain the status quo. Nevertheless, the relatively low turnout means that the non-binding vote will not have significant political consequences in the short-term.

The case of Catalonia will remain on Spain’s political agenda in the coming months. The most likely scenario is that a snap election will be called in Catalonia, which would become a de facto independence referendum. While Catalan President Artur Mas and his Convergence and Union party (CiU) are seeking to build a broad coalition with all of the main pro-independence parties, the separatist Republican Left of Catalonia (ERC), which is currently leading the polls, does not consider such a single list necessary because it could undermine support to the pro-independence camp. Nevertheless, according to local media, Mas has seen his popularity increase since the vote and he would lead a coalition of CiU and relevant people from civil society. Moreover, Mas has requested to the Spanish government that a full-blown referendum on independence be held in Catalonia. President Mariano Rajoy, however, is standing firm that Spain’s 1978 constitution does not allow for a referendum to be held.

Uncertainty regarding the future of Catalonia—a region that accounts for nearly one-fifth of Spain’s GDP—is not the only source of concern for President Rajoy. A series of massive corruption scandals in public contracts involving Spain’s main political parties; senior executives’ and politicians’ fraudulent use of “black” credit cards from Caja Madrid—a bank that was rescued with public funds; the surge of a new anti-austerity party; and the questionable management of an Ebola outbreak may well threaten traditional political parties’ dominant position ahead of the May 2015 local election and the general election that is expected to be held in late 2015.

Author: Ricard Torné, Lead Economist

Date: November 20, 2014