martes, 28 de agosto de 2012

Catalonia formally requests rescue

The region of Catalonia has requested a rescue from the Spanish government. The Catalan regional government formally made the request today Tuesday to the national government for a loan of €5bn from theLiquidity Fund for the Autonomous regions (FLA), although Catalan representatives said the region will not accept “political conditions” to get access to the funds “which actually belong to the Catalans.”
The spokesperson for the Catalan regional government, Francesc Homs, said this money will be used to comply with the public deficit target of 1.5 percent of GDP in 2012, which it is obliged to do, and to refinance “pending payment obligations” until the end of this year.
The Catalan government made the request to the FLA during its first meeting after the summer holidays, as had been announced by regional deputy premier, Joana Ortega, on August 19.
At that occasion, Ortega recognized that the delay in the creation of this fund –which may not be active until the fall – could create liquidity problems in Catalonian, although she added that the regional government wouldn’t analyze the financial situation of the region until today Tuesday.
In July, the regional minister for economy, Andreu Mas-Colell, and the spokesperson for the Catalan government, Francesc Homs, already took for granted that Catalonia would have to turn to the new fund for help, although they did not specify a date and they denied that this help would look like a request for a rescue.
Rajoy and Mas will meet on September 20
The request for the rescue from the Catalan government occurs one day after a letter from Prime Minister Mariano Rajoy to Catalonia’s Premier Artur Maswas made public, in which the prime minister promises to look into the fiscal part that was suggested by Mas in July. Rajoy also asks Mas for his support to strengthen Spain’s position in Europe.
The two will meet on September 20 at the Moncloa, the government headquarter in Madrid, according to official sources. Rajoy did not mention the fiscal pact as a specific topic to discuss during the meeting, although the Catalan leader will ask for this.
The meeting between the two of them has been pending since April, but since then the political climate has become more complicated. The Catalan regional government and the Convergence and Union (CiU), a centre-right Catalan nationalist federation, have supported the idea of a so-called fiscal pact, which would introduce a similar structure in Catalonia as in the Basque country
The decision to request a rescue had been preceded by speculations about the time and details of the rescue, and it was not expected to occur until in September.