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Catalonia, the December 21 elections will not be decisive

REPORT BY INTESA SANPAOLO – Recent polls indicate that pro-independence supporters oscillate between 47% and 50% of the votes, which should correspond to a number of seats between 66 and 69, or rather a weak majority.

Early elections to the Catalan Parliament will be held on 21 December, following the early dissolution of the chambers declared on 27 October 2017, through the application of art. 155 of the Spanish Constitution, activated following the unilateral declaration of independence by President Puidgemont. The Catalan Parliament is made up of 135 members elected on the basis of a proportional system with a threshold of 3%.

The members are elected from lists corresponding to the cities of Barcelona, ​​Girona, Taragona and Lleida. In the 2015 elections, the pro-independence list Junts pel Sí (JxSí) (which included the two main Catalan centre-left parties, Convergencia Demòcrata Català (CDC) and left at the time Esquerra Republicana de Catalunya (ERC), together with several minors) obtained 51 seats. The then president Artur Mas of the JxSí list managed to form a coalition government with the support of Candidatura d'Unitat Popular (CUP) accepting to be replaced as president by Carles Puigdemont. CUP, in fact, refused to support Mas, who he considered personally tainted by several corruption scandals involving the CDC party.

The pro-independence parties were in doubt whether to contest the elections, seen as a strain by the Madrid government and in fact as a denial of the October 27 declaration of independence. In early November, Puigdemont, a refugee in Brussels since the end of October, said he was interested in leading PDeCAT (Partit Demòcrata Europeu Català, previously CD) from Brussels in the elections on 21 December. The leaders of pro-independence parties arrested after the declaration of independence can participate in the elections if not yet convicted. Esquerra Republicana de Catalunya (ERC), a left-wing independence party, has refused to renew the alliance of Junts pel Sí and has made its participation in any electoral coalition, including (CUP), conditional on the participation of members of Catalunya Sí que es Pot , regional section of Podemos.

After the CUP ruled out standing in a coalition, ERC also decided to stand individually. After the CUP ruled out standing in a coalition, ERC also decided to stand individually. Among the parties with positions opposed to the independence of the region, in addition to the traditional parties we also mention CatComú–Podem and Ciudadanos Cs. Polls report record participation in the electoral event, exceeding 80%. In general, polls show a growing consensus for Ciudadanos and close to 25% and a slight decline for pro-independence parties that have focused their electoral campaign on delegitimizing the elections wanted by Madrid.

Recent polls indicate that the pro-independence Junts x Cat, ERC and CUP oscillate between 47% and 50% of the votes which should correspond to a number of seats between 66 and 69, ie a weak majority. The post-electoral panorama therefore promises to be very complicated and the formation of a government will take weeks. It is probable but not certain that after the vote the pro-independence parties will agree to form a government coalition. But what is more important is that there would still be a lack of a strong mandate in favor of the pro-independence movement, since even in a coalition the pro-independence activists risk having a rather slim majority.

Rationally, this should suggest a clear change of strategy, focusing on the negotiating openings that have emerged at national level at the request of the socialists, rather than looking for a new unrealistic head-on confrontation. Signals in this sense came from the number two of ERC, Marta Rovira. If they are confirmed, the Catalan question would be brought back to normal political dialectics. The path of dialogue has certainly paid off for other regions with pro-independence tendencies. Perhaps it has faded into the background, given the spotlight on Catalonia, but the Basque Country has obtained the renewal of a very advantageous budget agreement. In any case, after the tensions of early autumn, the dialogue to reach a new balance will not be quick or easy.

The Catalan affair takes place against a decidedly solid macroeconomic background. The Spanish economy continues to grow well beyond expectations: 2017 will close at +3,1%, half a point above the Consensus Economics estimates of a year ago, after three years and more of growth above 3% and more than two points stronger than the potential (estimated by the EU Commission at 1,1%). For the time being, the Catalan crisis has had a negligible impact on the confidence of households and businesses and even at the height of the tensions we have seen a very limited market reaction, with a marginal tightening of financial conditions. However, should the crisis escalate again, more significant repercussions could be seen.

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