The first of these problems is, precisely, that of division. Spain emerges from the general elections of July 23 and the subsequent long process to form a new Government more divided and with a more polarized society. The distance between the two main parties, the Popular Party (PP), on the right, and the Spanish Socialist Workers Party (PSOE), on the left, has increased considerably. At this time, it is almost impossible to think of measures agreed upon between these two parties to improve the economy and promote the country’s progress.

This division and unrest in society is due, in part, to the way in which the President of the Government, Pedro Sánchez, has negotiated his continuity in office. Sánchez has managed to revalidate his position thanks to the support obtained by the Catalan independentists in exchange for an amnesty for the crimes committed with the celebration of the illegal referendum on October 1, 2017. One of the beneficiaries of this amnesty will be Carles Puigdemont himself, who is a fugitive from Spanish justice.

This amnesty has been criticized by all organizations of judges, lawyers, notaries, as well as by the majority of senior employees of the Public Administration. Hundreds of thousands of people have demonstrated in the streets against this measure, which has also aroused criticism and distrust among members of the European Parliament.

The concessions to the independentists and other government partners, such as the coalition of far-left Sumar, have also caused concern in some sectors of businessmen due to the risks to legal security required for investment in the country. Some leaders of prominent companies have spoken publicly in this regard and have warned of the need to create conditions of stability and guarantees as soon as possible to facilitate the development of economic activity.

It is difficult to anticipate when and how that political stability can be restored. Some even predict a short life for the Government that has just been born, although the PP does not have enough seats in Parliament to attempt a motion of censure, not even with the support of the far-right party Vox.

In any case, it is better to prepare for a prolongation of the political instability that has dominated Spain in recent months. Any business initiative in this country must take into account that political scenario as much or more than strictly economic conditions.

La entrada New government, same problems se publicó primero en Estudio de Comunicación.

While there is still no end in sight to the war in Ukraine, which has had so many adverse consequences for Europe and Spain, the escalation of the conflict in the Middle East creates new threats to stability around the world.

The Hamas terrorist attack against the population of Israel has triggered a strong military reaction by the Israeli Government. The forecast is that violence and armed confrontations could last for months or even years. Other actors, such as Iran, the United States and several Arab countries, may be involved. Taking into account the volatility of the area and its enormous geostrategic importance, the effect of these tensions on the progress of other regions of the world can be very significant.

In the case of Spain, this worrying international context is combined with the extension of the provisional nature of the Government. The general elections of July 23 did not serve to form a clear government majority. The center right Popular Party candidate, Alberto Núnez Feijóo, failed in his attempt to obtain the parliamentary support necessary to be named prime minister.

Now it is the current acting President of the Government, Pedro Sánchez (socialist), who is trying. But to achieve this it depends on the Catalan pro independence parties, who have very little or none interest in the governability of Spain. One of the supporters that Sánchez needs is Carles Puigdemont, who fled from Spanish justice after organizing the illegal 2017 referendum and lives in auto exile in Belgium.

In exchange for his support, Puigdemont demands from Sánchez an amnesty for all crimes committed by the independentists for the organization of that referendum, a step that is opposed by the Popular Party, a majority of jurists and a large part of Spanish society.

Sánchez’s negotiation with the independentists may continue for more than a month. If not successful, Spain would be forced to repeat the elections, probably on January 14, 2024. But even if this negotiation were successful, the Government that would result would be very fragile and constantly subject to the pressure from parties that are not interested in the stability of Spanish democracy.

La entrada A LONG PERIOD OF INSTABILITY AHEAD se publicó primero en Estudio de Comunicación.

The recent elections on July 23 led to a dispersion of the vote and neither one of the two main parties -Partido Popular (PP) and Partido Socialista Obrero Español (PSOE)- obtained a sufficient majority to form a Government. Spain is a parliamentary system in which the support of at least 176 members of Congress is necessary to constitute a Government.

The center-right PP, which was the winner of the elections with 137 seats in Parliament, already has the support of the far-right party Vox, but it is still far from the 176 necessary to get the green light from Congress.

The Socialist Party (PSOE), which was second with 121 seats, has the support of the far-left Sumar and also appears to have the support of pro-independence parties in Catalonia and the Basque Country. However, to reach the magic number of 176 he will need the support of Puigdemont, who lives in self-exile in Belgium and whom Spanish judges are demanding for crimes against the Constitution and for corruption.

As an essential condition for giving his support to a new government led by socialist Pedro Sánchez, Puigdemont has demanded an amnesty from which both he and hundreds of other people prosecuted for the events of October 1 can benefit. Several experts have warned that such an amnesty would clearly violate the Spanish Constitution. Even former leaders of the PSOE have said that this amnesty would represent an attack against Spanish democracy.

It is not yet known whether Pedro Sánchez will accept Puigdemont’s conditions to continue as President of the Government, although several of his ministers who in the past rejected the amnesty because they considered it unfair and illegal, have now begun to admit that possibility. In the past, Sánchez pardoned other leaders of the 2017 independence uprising, but Puigdemont was excluded because, having fled the country, he has not even been tried.

La entrada In the hands of the independentists se publicó primero en Estudio de Comunicación.

This uncertainty coincides with the period in which Spain holds the rotating presidency of the European Union, which runs from July 1st to the last day of December.

The polls predict a victory for the conservative Popular Party (PP), but with an insufficient number of seats in Parliament to be able to form a Government alone. The most feasible alliance would be with the far-right Vox party, but the negotiation could be long and complicated, since the leader of the PP, Alberto Núñez Feijóo, has assured that he will not renounce the essential principles of his political program in exchange for being prime minister.

With regard to the party that is now the majority in the Government, the Spanish Socialist Workers’ Party (PSOE), no survey gives it as the favorite for victory on the 23rd, although the possibility of forming a Government in a coalition with all the parties at his left, as well as with other nationalist and regionalist parties, is not ruled out.

A coalition of this nature would entail a risk of political instability, since the PSOE would probably have fewer seats in Parliament than it currently has and would be forced to join very different political forces with interests and programs that sometimes clash with those of the PSOE.

Nor would it be easy to build a pact on the right either. Even if the PP were the party with the most votes, it would have to get the support to govern from a party like Vox that repeats the populist and anti-immigration speech that other far-right parties have been delivering in different European countries in recent years.

Therefore, Spain may find itself in a political blockade as of July 23rd that could even last several months. Only an unlikely victory for the PP by an absolute majority would guarantee the rapid formation of a new Government.

Article by Antonio Caño, partner at estudio de Comunicación

La entrada RISK OF POLITICAL BLOCKADE se publicó primero en Estudio de Comunicación.

At the same time, this electoral advance supposes the almost total paralysis of the functions of the central Administration, which will be limited to dispatching ordinary affairs during the next six weeks, as well as representing a obstacle for the performance of the rotating presidency of the European Union, which corresponds to occupy Spain as of July 1.

The early calling of elections has been forced by the defeat of the parties that make up the majority of the Government in the municipal and regional elections held on May 28. Both the Socialist Party (PSOE) and the far left party Podemos suffered severe losses in those elections, giving considerable ground to their opponents in the conservative Popular Party, Partido Popular (PP).

Sánchez interpreted this defeat as a vote of punishment for his government’s policy and decided to advance the general elections so that the Spanish voters decide as soon as possible if they maintain confidence in the parties of the current government coalition or prefer that power pass into the hands of the right.

The announcement of this new electoral campaign has further polarized Spanish politics. The Socialist Party warns of the risk that a victory for the Popular Party would entail for the social model that it claims to defend. PP, center right, might have to rely on the far right party Vox in order to achieve a majority in Parliament. The Popular Party, for its part, insists on the need to put an end to what it calls “el sanchismo”, which it defines as a very radical style of government that has led the country to division and confrontation. The leader of the PP, Alberto Núñez Feijóo, has explained that his intention is to obtain a majority that allows him to govern without Vox.

Meanwhile, the far left is waging a bitter infighting among its leaders, likely to see them divided into July elections with little chance of a good result.

Although PSOE and PP are presented to the voters as radically opposed options, the truth is that the arrival of the conservatives in the Government would not mean a substantial change in the country’s political or economic model, although it is foreseeable, in the event of a victory for the conservatives, an economic policy that places greater emphasis on controlling the deficit and public debt, as well as a brake on tax increases.

The polls so far predict a relatively comfortable victory for the PP. That does not guarantee, however, a majority to immediately form a government. Negotiations to form an Executive can be long and difficult. On the other hand, we must count on the recovery capacity of Pedro Sánchez, who has already shown signs of recovering in circumstances of extreme adversity in the past.

By Antonio Caño, Partner at Estudio de Comunicación

La entrada Early elections se publicó primero en Estudio de Comunicación.

Although most polls predict a victory for the conservative Popular Party throughout Spain as a whole -which could be significant for the national elections at the end of the year-, the most important thing is to know which parties or coalitions will end up governing in each of the 12 autonomous communities and more than 8,000 municipalities that vote on May 28th.

Autonomous communities are very important in Spain, a country with an almost federal government model. Autonomous communities have their own Parlaments and a great capacity to make their own decisions in matters of health, education, taxes and other important areas for the economy. Their role is therefore very relevant for business development.

There are no elections in what are called “historical communities” (Catalonia, Basque Country, Andalusia and Galicia), but there are in others with enormous weight on the Spanish economy, such as Madrid, the Balearic Islands and the Valencian Community.

With the exception of Madrid, where the Popular Party has a great advantage in the polls, in all other major communities the result is difficult to anticipate. We are, therefore, in a period of uncertainty and waiting, which, in the case of Spain, is justified both by global circumstances and by the national political situation.

La entrada WAITING TIME se publicó primero en Estudio de Comunicación.

One of the uncertainties that the May elections should help to clear up is that of which will be the dominant parties on the left and what are their chances for that block to have a sufficient majority to govern.

The current Government coalition in Spain is made up of the Partido Socialista Obrero Español  (PSOE) and Unidas Podemos, a group further to its left. However, in recent months internal divisions have arisen within Unidas Podemos and, at this time, it is not clear who will be the candidates to the left of the PSOE.

On Sunday, April 2, Vice President Yolanda Díaz, until now a member of Unidas Podemos, announced her intention to be a candidate for the presidency of the Government at the head of a new party called Sumar. At the same time, the former vice president and former leader of Podemos, Pablo Iglesias, is reluctant to support Díaz and seems willing to present a different candidate.

The division of the forces to the left of the PSOE into two different candidacies would make it more difficult for them to obtain deputies in Parliament and, therefore, would make the repetition of a left-wing coalition Government more unlikely. It is extremely difficult for the PSOE to obtain a sufficient majority to govern on its own.

Therefore, May elections will serve to verify who is stronger on the far left, who is the real boss of that block: Yolanda Díaz or Pablo Iglesias. After that, maybe, just maybe, one of the two will agree to relinquish power.

By Antonio Caño, associate at Estudio de Comunicación

La entrada The division of the left se publicó primero en Estudio de Comunicación.