Would an independent Catalonia be economically feasible?

CatDem logoThree reports have been commissioned by the CatDem Foundation to answer the question, “Would an independent Catalonia be economically feasible?”. Now of course, considering who the reports were commissioned by you don’t need me to tell you the conclusion. But all 3 make for interesting reading. They’re not particularly long, 11, 7 and 14 pages respectively. But they give some insight into the fiscal implications of an independent Catalan state.

From the CatDem press release…

As part of a general reflection about the “National Transition” that Catalonia is going through, the CatDem Foundation has put together three reports that analyse the economic feasibility of an independent Catalonia. These documents closely analyse all the possible consequences to the Catalan economy if it were to become an independent State. The reports focus on three different areas.

The first report is titled “Feasibility of Catalonia as a state. Analysis of public funds” by Núria Bosch and Marta Espasa. Núria Bosch is a tenured professor of public finance at the University of Barcelona and Marta Espasa is a professor in the Department of Public Economics at the same university. The study analyses the feasibility of Catalonia as a state from the perspective of public funds. The study calculates how the Catalan Government’s public accounts would be affected in the case of independence. In order to do so the authors calculated the level of public spending that would be needed to cover the institutional powers that currently belong to the Spanish state. The main conclusion of the report is that an independent Catalonia would gain between 922 million euros (based on data from 2009) and 21,071 million euros (with data from 2007). In addition, an independent Catalonia would situate itself 9% above the average of the EU-15 regarding GDP per capita.

The second report is titled “Reflections on a Future Catalan Tax Agency” by Heribert Padrol, economist and former head of the Tax Area Corps of the State finance inspector in Catalonia. In his report Padrol suggests how a Catalan Tax Agency should be defined and organised. Padrol analyses how this new tax agency should be configured to better fight fiscal fraud, guarantee the legal protection of taxpayers and to encourage an improvement in taxpayer assistance.

The third report is titled “How will the Autonomous Communities be affected by the new fiscal integration?” by Xavier Cuadras i Morató, economist and professor in the Department of Economics and Business of the Pompeu Fabra University. His report analyses the effects that Catalonia’s independence could have on Catalan exports and trade balance. Cuadras concludes that a boycott of Catalan products would have a residual effect on the Catalan economy. The report affirms that “the independence and the elimination of the fiscal deficit would lead to a rise of not just the disposable income of Catalonia in the short-term, but also its growth perspectives in the mid-term.”

You can download and read the reports for yourself in PDF format below.

CatDem Foundation links

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