Although he left behind the turbulent era of the independence process, Catalonia still does not convince foreign capital. According to data collected by the Secretary of State for Commerce, the community chaired by Salvador Illa received only 15% of gross foreign investments between January and June 2024. A discreet figure compared to the share of the investment pie obtained by Madrid (67.5%).
In the first half, Catalonia raised 1,761.54 million euros, ranking second behind Madridwhich attracted 7,940.06 million. Next come Asturias (594.97 million), Aragon (333.33 million), Valencia (324.99 million) and Andalusia (191.88 million). The remaining eleven autonomy totals 616.08 million.
The Commerce report reveals another worrying factor: the collapse of international investments in Catalonia between 2023 and 2024. Although the fall has been generalized to all Spanish regions, the Catalan community is suffering a greater decline than that of its main competitor . Concretely, the year-on-year decrease in foreign investments was 62.8% in Catalonia. In Madrid it was also accused, with a drop of almost 47%, but once again the central region shows greater resilience.
Faced with this data, a spokesperson for the Department of Business specifies that the methodology used by the Ministry of the Economy to carry out the count takes into consideration the location of the company’s head office. In other words: even if a company establishes its subsidiary in Madrid but opens a factory in any Catalan province, for statistical purposes it is counted as an investment raised by Madrid. The same source assures that this procedure should have been reviewed in 2024, even if it does not confirm that the ministry has taken this measure.
It’s not all bad news for Catalonia. The community managed to reverse three consecutive years of decline and return to silver in the territorial rankings. In previous years, it had been overtaken by Valencia and the Basque Country as the most attractive destination for foreign capital. The main investors in Catalonia come from Germany (46.6%), the United States (20.7%), the United Kingdom (6.3%) and India (6.2%).
However, even after recovering second place, the Catalan community loses the good tone timidly displayed last year. In 2023, President Pere Aragonès boasted that Catalonia had recorded its best year since 2016 in terms of international investment flows. Concretely, they increased by 18% and, taking the five-year period 2019-2023 as a reference, they increased by 39% compared to the previous five years (2014-2018). This dynamic is now on hold.
In fact, if we turn on the lights, we observe a certain stabilization of the behavior of Catalonia, in contrast to the vitality demonstrated by Madrid. Thus, the region led by Isabel Díaz Ayuso has managed to increase private fundraising from 5,000 to almost 8,000 million euros over the last decade. In contrast, Catalonia hovered around similar magnitudes throughout the same period.
Bureaucracy and tax pressure
In the first half of 2024, this situation can be attributed to both geopolitical turbulence, notably the war between Ukraine and Russia and the Arab-Israeli conflict, and the global economic slowdown which has affected Catalonia as well as other regions. However, autonomy brings its own dynamic which justifies this loss of rhythm.
“Two of the elements that explain this difference between the two communities are trends and expectations. Catalonia’s trend towards interventionism, increased tax pressure and regulation has been constant over the last decade. This fact, which could have been temporary, has become structural in the Catalan economy. This is part of your way of being economic. And this conditions their expectations in terms of future growth. Not really having alternatives anymore business friendly like the Community of Madrid”, explains Albert Guivernaudirector of the Civismo Foundation and doctor in economics.
“On the other hand, the economy of the capital region has maintained a constant, since the governments of Esperanza Aguirre, in the liberalization of the economy, deregulation, reduction of the tax burden and attraction of investments These policies have become structural aspects of the CAM, providing investors with a clear panorama in which they can invest easily and the regional administration will be an ally and not an adversary. It is very difficult for Catalonia to recover positions since. Madrid’s position is solid, constant and consistent in the long term, offering greater expectations than Catalonia,” adds Guivernau.
In recent times, proposals have been put forward to reverse the tax burden faced by families and businesses in the community. The bosses Treball Promotion Just before the last regional elections, he presented a battery of measures to put an end, in his own words, to the Catalan “fiscal hell”.
The most notable initiative of the entrepreneurial organization is the abolition of the wealth tax, which is complemented by the request for modification or abolition of several of its own taxes and by the reduction of sections or taxes of the State transferred to the Generalitat. To date, the new Government The CPS did not take up the challenge and assured that no tax cuts would be included in the preparation of the 2025 budgets.
Where the Catalan government appears to be more receptive is in easing bureaucratic obstacles. The Minister of Commerce and Economy, Miquel Sàmper and Alícia Romero, promised to streamline the administration’s paperwork.
