MANEL PÉREZ, ELISENDA VALLEJO – BARCELONA – 03/14/2021
Nadia Calviño assures that there is a very correct institutional dialogue with the Government of the Generalitat LV / Dani Duch
Nadia Calviño, third vice president and economy minister, warns that political stability is essential to attract investment and for growth. But she is convinced that the turmoil in Madrid and Catalonia will not affect the roadmap for European funds.
“We have avoided a 35% drop in GPD and the destruction of 3 million jobs”
– You have just approved an aid plan of 11,000 million and the employers have already said that it is insufficient and that it is late. What do you have to say to those criticisms?
– The Spanish Government has acted with enormous determination and agility. We adopted the first package of measures on March 10 of last year and since then we have not stopped working, always trying to anticipate the problems that could come. And I believe that the actions we have developed in 2020 have been effective in counteracting the impact of the pandemic. We have avoided a fall in GDP that would have been greater than 25%. We have prevented the destruction of more than 3 million jobs. We have managed to stabilize the unemployment rate around a 15.5%. And now the package that we have approved goes along the same lines. The aid and instruments that we have put in place in Spain are among the most important in Europe and I believe that they are also among the most effective. And I am convinced that the package approved on Friday completes a very powerful battery of measures, of great scope and unprecedented in our history.
– Despite this balance, it is said that the Ministry of Economy has dragged its feet a lot, that somehow it did not want to assume that idea of direct aid. In fact, a certain debate has transpired in the Government, also with the Bank of Spain. Couldn’t it have been done before?
– These speculations do not correspond to a government that has been giving direct aid since March last year and has mobilized resources for more than 20% of GDP in 2020. The measures already planned for this year exceed 2% of GDP. As both the Minister of Finance and I have said repeatedly, this type of speculation about discrepancies or tensions does not correspond to reality. The truth is that we have been working since the autumn with a view to preparing a solvency package. Already then, in autumn, we adopted measures to extend the terms of the ICO guarantees and the grace periods, as well as tax holidays. To begin in this line of reducing the costs of companies, it was decided to reinforce their capacity to withstand this last phase of the crisis. And the new package is one more step in that direction. When I speak to the ministers of the rest of the European countries, we are all facing the same challenges and the same type of objectives, and we are fully aligned with the main recommendations.
– Why then is Spain the red lantern in all the reports?
– Absolutely not. The National Productivity Council of France recently released a report on public aid that ranked Spain as the country that had given the most. The National Commission of Markets and Competition (CNMC) values them as the most important. The European Commission last week published a report that shows that, beyond the announcements, the effective aid mobilized by Spain in terms of GDP is the most important of all the large countries of the Union. The public announcements must be separated very well from the aid that is really channeled to the economy, and there the information from the European Commission is very clear.
– Are you aware that the image that is being offered is that the Minister of Economy is very afraid of going into debt and that she has the brakes on this front…
– We are talking about public money and the present and future taxes of all Spaniards, and a good government has to take great care that its public resources are used in an efficient way. I think that when you look at the volume of aid that has been mobilized, our Government has not hesitated when it comes to mobilizing public resources or increasing debt: an additional 150,000 million euros in 2020 and 2021. It seems to me that it is a perception or a type of speculation that does not correspond to reality. Another thing is that a responsible government has to make sure that money is used in the best possible way, that it really reaches those who need it and that it is managed to solve the real problems, which at this moment are the possible risk to the solvency of companies.
– You have announced a specific item of 2,000 million for the Balearic and Canary Islands. In the case of Catalonia, where tourism also plays a significant role, how much will it receive? Is there an estimate of how many SMEs and freelancers can benefit?
– The criteria for distribution to the autonomous communities will follow the same principles as those used for the distribution of the European React EU funds, those 8,000 million euros that have already been transferred to the autonomous communities in 2021, which respond to the fall of GDP, the increase in unemployment and especially the increase in youth unemployment. Those are the criteria that will guide the assignment in the ministerial order that will be approved next month. And with regard to the number of companies, all those that meet the requirements and those that the autonomous community may determine will have access. Our goal is that all those found in this situation, with a drop in income of more than 30% in the most affected sectors, are covered. These are aids that are in addition to those already existing and that are protecting many groups. At the end of February, there were 60,000 freelancers in Catalonia charging for cessation of activity, 189,000 workers covered by ERTE and the ICOs had given 21,618 million in financing.
– With that criterion, 7,000 million is not little? What scope is there to expand that volume?
– I understand that companies put larger amounts on the table. We have been working with the Bank of Spain, with financial institutions, we have carried out a macroeconomic and sectoral analysis to determine what the necessary magnitude could be.
– And as for the deadlines, when can the aid begin to be received?
– We have self-imposed on the State a period of one month and ten days to prepare the orders and the rest of the legal instruments to put this in motion. As soon as the agreements with the communities are signed, the funds will be transferred to them.
– In this era of digitization and management in theory very agile, it seems like a long time … we are talking about two months…
– Companies have a battery of instruments: credits with public endorsement, extension of grace periods and payment periods for these credits, which are being requested at a very good pace right now, ERTEs, tax holidays. Now, it is completed with the direct aid fund, the Cofides recapitalization funds for those that do not reach the thresholds for the SEPI recapitalization fund, and a framework so that, together with the financial sector, the public sector supports also debt restructuring processes.
– What do the latest data from your ministry indicate about the evolution of the economy?
– Since the peak of the third wave, there have already been 136,000 workers at ERTE who have returned to work. I hope this trend will continue in the coming weeks if we continue to reduce the incidence of the pandemic and the vaccination process continues to accelerate. The forecast points to a very intense growth in the second part of the year. That is what all public, private, national and international organizations foresee. The OECD and the European Commission in their latest forecasts make an upward revision of growth for Spain this year and next, so that Spain would be the European economy with the most intense growth in the two years as a whole.
– In the case of tourism, everything is very pending of the summer, but the uncertainty is still very high…
– We have to do everything possible so that mobility can be safely recovered as soon as possible, both nationally and internationally. For this reason, in addition to effective work in the fight against the pandemic, we are working on the development of this interoperable health certificate at a not only European level, but also at the OECD, so that as soon as possible the movements can be safely recovered and the tourism sector can get its rhythm back as soon as possible.
– Do you share the diagnosis of Airef, which foresees a decrease in GDP in the first quarter of 1.3%?
– January and February have been months of a clear slowdown due to the pandemic. At this time, the daily indicators send mixed signals and we have to see how the economy evolves in the month of March. That will largely determine how the first quarter of the year closes. After the intense reactivation of the third quarter of 2020 and positive growth compared to all European countries in the fourth quarter, in the first quarter of this year the evolution of Spain is very aligned with that of the rest of the European countries. We see a slowdown in January and February and the progressive recovery as restrictions are removed.
– In the political sphere, Spain is once again entering a phase of great turbulence. Are you concerned about its possible impact on the evolution of the economy? To what extent can it interfere in the management of European funds?
– Obviously, political stability is always a positive factor for attracting and mobilizing investment and for economic growth, which we have not seen in Catalonia in recent years. We all have a shared interest in having as stable a framework as possible. In addition, it is very important that all efforts are focused on common priorities: fighting the pandemic, protecting the productive fabric and employment, and putting the recovery plan in place. That should be the priority for everyone. In any case, from the Government of Spain we are very focused on these priorities. I hope that the movements that are taking place in some autonomous governments do not put this joint work at risk.
– But the governments of the first two communities in the country are now in an interim situation. Can there be changes in the management of the funds?
– No, it doesn’t have to. It does not affect our roadmap at all. We are working to finish outlining the plan worked with the European Commission, with a view to being able to present it before the end of this quarter. I hope that it will be approved as planned in June and that we can have these additional resources available in the second part of the year. In any case, we already foresee a very important volume of investments in the general state budgets for this year, fully aligned with the plan, and we are continuing with our reform roadmap. The Government of Spain precisely at this time is an element that gives our country a lot of stability.
– In the case of Catalonia, that temporariness was manifested recently in the act of Seat, with the absence of the Generalitat. Despite this, is there good communication between the central government and that of Catalonia?
– Yes, I think the institutional dialogue is very correct. Just yesterday (on Thursday) I was exchanging messages with Pere Aragonès García, the acting president, about the aid package that was going to be approved. We have a very cordial relationship. Now, I think it is a pity that the Generalitat was not represented in the presentation of such an important project for the future of Catalonia and the whole country as it is to lay the first stones so that Spain is a leading country in development of the electric vehicle.
– An issue that is very present in the possible electoral campaign in Madrid is that of taxation and the possible fiscal dumping of Madrid, its role benefiting from being the capital city. What do you think?
– At the European level, the Government of Spain has a very active position against those strategies that consist of lowering taxes to attract economic activity and it is the same that we have in the Spanish area. We have a shared interest in having solid fiscal systems, at the state level and at the regional level, so that the country as a whole has a well-financed public sector and fiscal sustainability in the medium and long term. At this time we have established a set of very solid solidarity mechanisms for the autonomous communities,
– The Minister of Finance speaks of tax dumping in Madrid. Do you share that diagnosis?
– I fully agree with what the Minister of Finance has said in this regard.