Catalonia Announces a Referendum on Independence

Summary


Catalonia's announced independence referendum is an open challenge to the Spanish government, but it is also part of a difficult compromise between the members of the autonomous region's fragile ruling coalition. The Catalan government released news of the referendum, scheduled for Nov. 9, 2014, and which Madrid considers illegal, on Dec. 12.

The ambiguous wording of the referendum will likely exacerbate existing fault lines within the Catalan government, enabling Madrid to manage Catalonia's bid for secession. Even if on the surface it looks as if Catalonia is making progress on its path to independence, the situation has only gotten more complicated for the region.

Analysis


The president of Catalonia's regional government, Artur Mas, said the November referendum will include two questions. The first will ask the Catalans if they want Catalonia to be a state. In case people respond affirmatively, there will be a second question: whether Catalonia should be an independent state.

This mechanism is the result of a compromise between Catalonia's ruling parties. The autonomous region is ruled by Convergence and Union, a federation of two political parties. Within this federation, members of Convergence tend to be more supportive of independence than their counterparts in Union. Convergence and Union has traditionally pushed for greater fiscal autonomy from Madrid, and the open demand for independence is only a recent element of its political agenda. But the government needs backing in the Catalan parliament by the Republican Left, a center-left party that is considerably more vocal in its demands for independence. Two smaller parties in the center-left also support the referendum.

Due to the complex wording of the referendum, most political parties in Catalonia will have a difficult time communicating exactly what they want their supporters to vote. Those who want independence will have to vote "yes" twice, while there's a possibility that some voters will vote "yes" to the first question and "no" to the second. More important, it is not clear what would happen if people vote "yes" for Catalonia becoming a state but "no" for Catalonia becoming an independent state. Theoretically, this could mean that Catalans want Catalonia to become a state within a federal Spain. (Spain is formally a unitary state, with regions that have different degrees of autonomy.) A November poll revealed that 48.5 percent of Catalans want independence, 21.3 percent want a federal state and 18.6 percent want Catalonia to remain an autonomous community.

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The timing of the referendum is also important. Catalan leaders originally wanted the referendum to be held in September 2014, which marks the 300th anniversary of the defeat of Catalan forces by Spanish forces in the aftermath of the war for Spanish succession. The Catalan government later said September was a poor choice because it would be difficult to campaign during the summer. However, the delay suggests that some factions within the Catalan government sought to buy more time to negotiate with Madrid. The Spanish government has many things to offer Catalonia, including a new fiscal agreement and softer deficit targets.
Madrid's Position

Catalonia's push for independence is the combination of centuries-old nationalist claims and more recent fiscal needs. Barcelona, the capital of the region, believes Catalonia contributes disproportionately to the tax revenue of the central government while receiving little in the way of benefits and assistance in return. The richest region in Spain, Catalonia accounts for more than 20 percent of Spanish gross domestic product but contains less than 15 percent of Spain's population. The regional government argues that it transfers more than 9 percent of its annual GDP to Madrid (20 billion euros, or $27 billion) while itself running a budget deficit. In 2010, Spain's Constitutional Court blocked a Statute of Autonomy that would have given Catalonia more control of its finances, reigniting Catalonia's claims for independence.



Spain's Geographic Challenge

Since the Catalan government began entertaining the possibility of a referendum in late 2012, the central government in Madrid has said that the referendum would be illegal because the Spanish Constitution does not allow secession. The only legal alternative would be for the Spanish parliament to give Catalonia special prerogatives to hold a legal referendum -- similar to what the British Parliament did with Scotland. However, most of the political establishment in Madrid -- including the ruling Popular Party and the main opposition party, the Spanish Socialist Workers' Party -- rejects this possibility. After the announcement by Mas, Spanish Prime Minister Mariano Rajoy said the referendum would not be held despite whatever Catalonia said.

This means there will probably not be a unilateral declaration of independence by Catalonia. The Catalan government will push to hold the referendum anyway, hoping to get enough popular support to have a negotiating tool with Madrid. If Madrid continues to say no -- for example, by taking the referendum to the Constitutional Court, where it will probably be annulled -- then the Catalan government plans to hold early elections with independence as the main issue. In the long term, Catalonia hopes that the political crisis with Madrid will become so acute and popular support for independence so massive that the European Union will push Madrid to negotiate.

But this strategy has its problems. First, Catalonia's export-driven economy needs access to EU markets to survive. On several occasions, EU officials have said that an independent Catalonia would not automatically become a member of the bloc and that its accession could take years. Moreover, the European Union has little interest in promoting secessionist movements at a time when it is trying to simply hold the political union together. Catalonia could try to sign a free trade agreement with the bloc in the meantime, but that would also be a lengthy process and Madrid could try to delay it. Opinion polls show that support for independence decreases significantly if it means leaving the European Union.

Second, the Catalan government will experience serious internal frictions in the months leading up to November, which could make it collapse before the referendum. Madrid will try to exploit these frictions, offering some concessions to Catalonia (most notably financial assistance) while firmly rejecting the referendum. Even if the referendum is held, its outcome will be controversial because of the questions. In addition, the potential for calling new elections after the referendum entails problems of its own, since Convergence and Union is afraid that it could lose votes to the Republican Left -- a possibility that reduces Mas' desire for elections.

The struggle between Madrid and Catalonia will be a key political issue in 2014, particularly as the date for the referendum approaches. However, the Dec. 12 announcement highlights the extent to which the Catalan government sought to protect its short-term unity at the price of creating more problems in the future. In the long run, this decision does little to help Catalonia's push for independence.

Read more: Catalonia Announces a Referendum on Independence | Stratfor