Catalonia is the main risk for Spain’s new government
Friday, January 10, 2020
Significance
Sanchez will now have to do something which he desperately sought to avoid: rely on Catalan support to survive in government.
Impacts
- A PSOE-ERC deal which is more favourable to Catalonia will fuel support for Spain’s People’s Party (PP) and Vox.
- Uncertainty in Catalonia will continue to delay investment decisions while more social unrest will damage tourism and the property market.
- Spain’s economic outlook will mostly hinge on what happens with global trade.