Winds of political change in Spain
For the first time in years, voting intention polls shows the opposition party ‘PP’ in the lead passing the ruling party ‘PSOE’. New PP leader, Alberto Núñez Feijóo has gained back voting ground since he became president of the Popular Party (PP) in April, following a dramatic internal crisis in the party. Additionally, government coalition PSOE-Unidas Podemos may be threatened due to differences between parties and recent tensions; additionally, the latter seems to be losing voting ground while Second Vice-President and Labour Minister Yolanda Díaz has announced a new political party.
It is worth noting that there are regional elections in Andalucia on June 19th, where voting intention polls show that ruling PP is set to win again the regional election. Yet the question is whether PP will count on enough votes to secure an absolute majority or whether they will need to seek the support of other parties. Currently, PP is the ruling party in Andalucia, in coalition with liberal party Ciudadanos and ultranationalist party Vox. Andalusia’s parliamentary elections have always been a major test of Spain’s political system. With 8.4 million inhabitants and a surface area equivalent to that of Portugal, Andalusia remains Spain’s most populous region, the one that contributes the most MPs to the Spanish Congress.
The Spanish parliament has passed the Audiovisual Law
The Spanish parliament has passed the Audiovisual Law thanks to the last-minute abstention of the opposition Popular Party. For the first time, the two coalition ruling parties (PSOE and Unidas Podemos) voted against each other on the new Audiovisual Law, a project that was approved by both parties in the Council of Ministers. According to the Spanish media, this is a clear reflect of the end of the legislature and the coalition parties.
The Government announced that the new law ‘adapts to the new dynamics of the audiovisual sector and creates instruments that respond to the needs of creators, industry and audiences.’ However, it has been surrounded by controversy for months until ruling party PSOE introduced an amendment before the vote that modified the definition of “independent producer”. This change would allow, according to the independent producers’ associations, “large television stations” or “any operator” to have the capacity to produce content that “counts as fulfilling the obligation dedicated to independent producers. This modification promotes a greater concentration of the industry”, they said in a statement.
The Spanish government must pass more than 30 laws by 2023 to comply with the reforms it has committed to Brussels in exchange for EU funds
In addition to the audiovisual law, the telecommunications law, the insolvency law, the ‘create and grow’ law and the start-up law, among others, must be ready before the end of the year. And the Government is working on the second phase of the pension reform: company pension plans promoted by the public sector.
Unidas Podemos, PSOE’s partner in Government launches the second labour reform
The focus this time is on the potential entry of trade unions in the boards of directors of private companies, as well as in their capital. The reform of the Workers’ Statute that the Second Vice-President and Labour Minister Yolanda Díaz wants to promote will facilitate the participation of workers in companies’ decision-making as well as in their capital.
Bank of Spain calls for European funds to be invested in the most dynamic production sectors
For the Bank of Spain, a 1% increase in public investment ‘would trigger an increase of the same magnitude in private investment in the short term,’ according to the institution led by Pablo Hernández de Cos. This would explain the importance of ensuring that projects are aligned ‘with the objectives of structural transformation of the Spanish economy in the medium and long term’. Thus, the organisation provides clues as to which sectors it believes public investment should be targeted. It suggests focusing on infrastructure, communications and intangible goods.
Spain is absorbing most of the European funds that form part of the Recovery Plan, for which the country will receive more than 70k M€ in subsidies and another 70k M€ in loans to be repaid.
The Spanish government pressures companies to raise wages in the face of thousands of vacancies in the Spanish market
The most recent European statistics reveal that the phenomenon known as Great Resignation is far from being a problem for Spain. Quite the contrary: Spain is the EU Member State with the fewest job vacancies as a proportion of the total number of jobs available.
An alternative is for the target company to activate loyalty shares, a new mechanism under the Spanish law that allows for the doubling of the weight of shareholders with more than two years’ presence in a company, which would dilute the power of the hostile shareholder.
Spain’s Government pressured by the raising Consumer Price Index, which is now at 8.7%
The Consumer Price Index (CPI) has risen in May to 8.7% due to higher petrol and food prices. It is still 1.1 points below the peak in March, when the CPI reached 9.8%, its highest rate in almost 37 years.
Businesses continue to flee Catalonia and relocate their social headquarters in Madrid
Catalonia is the region that has suffered the greatest loss of business’ turnover in the first quarter of the year, after companies left the autonomous community – most of which are settling their headquarters in Madrid – representing a total income of 553 M€. No other region in the country has suffered such a large outflow in terms of turnover. In total, 225 companies with the above-mentioned combined turnover have left the Catalan region to relocate their head office to another region.