Thursday, December 15, 2016

Pontevedra Pensées: 15.12.16

Back to normal . . .

There are 2 problems with Spain's daily timetable (horario). 1. The traditional split day, which means a 2-3 hour break at 'midday' - 2pm here - and a very late finish to the (re-started) working day. And 2: Spain is in the wrong time zone. The government, supported by the opposition parties, says it'll end the second of these next year and return Spain to the GMT zone of the UK to the north and Portugal to the south. From which Franco removed it in 1942. To put it in line with fascist Germany, would you believe. The first problem will take longer to resolve but there can be no doubt that most Spaniards would like to see the country assume a 9-5 working day. Or even 9-6. But whether we will ever see shops closing as early a 5pm, is another question. Currently, it's 8.30 or even later. For bar and restaurant staff, it's after midnight. Often after a 12 hour day. Not everyone here has a great quality of life. Especially as putting in extra - non-productive - hours at the office is a cultural norm. Against a background of high unemployment and easy dismissal. If you're young, at least.

See the end of this post for an FT article on the Spanish economy, with my comments added . . .  HT to Lenox of Business Over Tapas for alerting me to this.

Galicia's AVE high-speed train project is the longest delayed in the history of Spain's public projects. Here's some of the forecasts for the operation of the line to Madrid:-
1988: By 1993
2008: By 2012
2010: By 2015
2015: By 2018
2016: By 2020
You might think that by now they could get this right but this week's local papers are full of fears it could be 2021 or even 2022. The reason is said to be a planned deviation from the existing line into Ourense which will cost a mere €600m and save all of 4 minutes. Anyone for 2025? En passant, it's 23 years since the first AVE line began operating, in 1993. And, Galicia aside, Spain's high-speed network is the longest in Europe and second, after China, in the world. It was reported back in 2015 that it will still be losing money in 2050. But possibly not yet here in Galicia. All this despite 2 recent Spanish presidents being from this region. Imagine how bad things would have been otherwise!

Not for the first time it's reported that car insurance in the Pontevedra province is the highest in Spain, at 50% more than the national average. One wonders whether it really reflects the accident rate here. Perhaps it's all our kamikaze drivers and death-prone old guys on un-cabbed tractors. Or maybe there's a cartel.

The good news is that tourism receipts here this year are way up on last year, as with Spain as a whole. Camino pilgrims have totalled 55,000 to the end of November. Which is 22% more than last year. The bad news is that the forecast for the next Holy Year of 2021 is 100,000. God forbid! Though I must surely be able to make money out of this opportunity. If I could be bothered. Perhaps my guided-tour-plus-massage concept.

Looking at the factors which aid the development of tourism in Galicia, some expert has cited 'excellent air links'. Given that nearly all my visitors are compelled to fly to Oporto in northern Portugal because Galicia's 3 international airports are so inadequate, this produced a laugh for me which was beyond hollow. Perhaps he was referring only to Spanish tourists. Who are the majority in this neck of the woods.

THE FT ON SPAIN    Comments in italics from me . . .

Suddenly, Spain does not seem such a bad place after all.

For much of the past decade, the country made headlines for its tottering banks and free-falling economy, for its corrupt politicians and the ever-expanding army of unemployed. Many of these challenges loom large even today. [You can say that again]

But in a year that has seen the UK vote to leave the EU and the US putting its faith in president-elect Donald Trump, at a time when populist and xenophobic parties are on the rise in Europe and political tensions are flaring around the globe, Spain is finally starting to abandon its defensive crouch. 

Compared with the political and economic uncertainties gripping so many other countries, the nation’s strengths are starting to shine a little more brightly.

“Spain has a very big advantage now: we are off the radar screen in terms of political uncertainty,” says Luis de Guindos, the economy minister. [Life is great. My husband has stopped beating me.]

The country’s strengths include, most obviously, an economic recovery that is now in its third year and still going strong. Unemployment, though still very high at 18.9 per cent, is falling steadily. Growth is forecast to reach 3.2% this year, almost twice the pace at which the eurozone as a whole is expanding. Even the long-moribund housing market, which created the bubble that triggered Spain’s economic collapse in the first place, is finally on the mend. [Opinions on this differ.]

The recent expansion has been fuelled by buoyant consumption and rising exports, and by a private sector that has grown leaner, nimbler and more innovative over the course of the crisis. For now, Spain’s business scene continues to be dominated by the traditional behemoths in banking, energy, construction and industry. But there is also an increasingly lively start-up scene in places such as Madrid and Barcelona.

Having lived through the harsh years in which job losses were the norm across all sectors, younger Spaniards in particular seem to have concluded that launching their own business is no less risky than joining a blue-chip bank or construction group. The money has followed the trend: investment in start-ups rose more than 80 per cent last year, according to Ascri, Spain’s venture capital and private equity association. [Sadly, as elsewhere, the great majority of these will fail.]

But it is not just the economic recovery that gives cause for quiet optimism. It is also, remarkably, the state of Spanish politics. After more than 10 months of political deadlock — the longest period that modern Spain has spent without a proper government — the country finally has a new administration.

Mariano Rajoy, the old and new prime minister, will preside over an administration that includes many of the names and faces from his previous tenure (such as Mr de Guindos). From the point of view of Spanish business leaders, that is mostly good news. There is relief that the period of uncertainty is over — and that Spain did not end up with a government intent on rolling back the economic reforms of the first Rajoy government. [Of course, it helps that, as in the UK, the Left is in total disarray, with even the upstart Podemos being wracked by personal rivalries.]

“The measures that we took during the crisis are paying off. Job creation is strong and growth is strong so that shows that the reforms have worked,” says José María Roldán, the president of AEB, the Spanish banking association. “What is very important is not to have a reversal of the reforms that worked. Reversing those measures would be suicidal.” [One of the leading banks is about to close down hundreds of branches and lay off 3,000 staff.]

Mr Rajoy, however, may face an uphill struggle. [British understatement?] After enjoying an absolute majority from 2011 to 2015, he now presides over a government that lacks both a parliamentary majority and broad popular support. Sceptics argue that the new legislature is likely to be short and unproductive. Indeed, it is not fanciful to imagine that the country will have to hold yet another general election next year (the third since December 2015).

In the light of political events elsewhere, however, even that scenario does not seem overly alarming. 

For all the upheaval and fragmentation of recent years, the political centre has held in Spain. There is not a single serious party, and not one member of the national parliament, that openly supports withdrawal from the EU. Spanish society has remained — remarkably, and almost uniquely — free from the virus of xenophobia. [Because most of its immigrants speak Spanish and are Catholic.

Neither the government nor the overwhelming majority in parliament have abandoned the broad principles that have underpinned western Europe for decades: liberal democracy, European integration, free trade and tolerance towards strangers. [Spain has been a massive beneficiary of EU largesse. Which the Spanish see as 'solidarity'.]

Spain has, of course, not remained immune to the rise of populist movements (however ill-defined the concept may be). The centre-left Socialist party, one of the two pillars of Spain’s political establishment, is under fierce pressure from the leftwing anti-austerity Podemos movement. But Podemos is very different from some of the other insurgent political parties in Europe. It agitates not against foreigners and migrants nor against the EU, but against the “corrupt” elites in politics, finance, business and the media. For the moment, though, those elites see no reason to feel overly threatened. Podemos is a political force to be reckoned with — but not one that is closing in on government power at the national level.

Most analysts believe that the fragmentation of Spain’s new parliament and the lack of a clear governing majority for Mr Rajoy are likely to produce political stasis. But there are other voices as well. They argue that what Spain needs now is not piecemeal reforms but grand bargains — on the country’s constitutional make-up, on the future status of the Catalan region, on the education system and on the creaking pension regime. For that, the country needs cross-party consensus one way or the other. [Maybe but there are few encouraging signs that this will happen. Cataluña has been handled very badly by the PP party - and don't even mention Gibraltar! - and it would be optimistic to believe this administration is going to end the PP confrontational approach. Too much in hock to its right wing.]

“The fact is that we have a parliamentary situation that is difficult, which in turn makes government more difficult. But this also creates an opportunity,” says Javier Vega de Seoane, the president of Spain’s Círculo de Empresarios, an influential business lobby. “We need to make deep reforms and these reforms have to be done by consensus. There is no alternative to striking a deal.” [Possibly. But this reality doesn't guarantee progress. Things are rather tribal here.]


Sierra said...

Meanwhile, the government is taking over the bankrupt toll motorways - too much to hope they'll be free in future? Alternatively, wonder if they'll try the "Ryanair/Easyjet" approach and lower prices to fill unused capacity - 5 cars at €2 > 1 car at €5?

Colin Davies said...

Saved for tomorrow's post. Almost as much as they wiil collect via the new taxes!

Alfred B. Mittington said...

Where in the world did you get the notion that 'there can be no doubt that most Spaniards would like to see the country assume a 9-5 working day'? Such an audacious statement surely deserves SOME shoring up with arguments and statistics? For it is my impression that most Spaniards actually prefer things the way they are. Traditional. As it always was. As it works well.

And must I remind you that back in the 80s (!!) the Felipe government already tried to change this? And failed dismally?