Finance column

The President of the CEOE Employers Organisation, Gerardo Díaz Ferrán, has said he thinks that wages should be negotiated to be at least 1% lower this year. He told ABC newspaper that a 1% reduction should be the starting point for this year’s wage round. It was his response to the claim from the unions that the CEOE is blocking 1,500 collective wage deals affecting nearly four million people. He added that he thought the unions should block any wage rise application of more than 2%, because companies cannot support wage increases above this number when they are reducing the prices of products and services.

There were 400 work fatalities in Spain this year to June, 26% less than a year ago. The number breaks down into 296 fatalities actually in the workplace and 104 who died on their way to or from their place of work. The numbers come from the Ministry for Employment.

Iberdrola and Endesa, the owners of the Garoña nuclear power station in Burgos are putting the final details to an appeal to the National Court against the decision of the Prime Minister to close the plant. José Luis Rodríguez Zapatero gave an undertaking to close plants at the end of their natural life, and has announced a closing date for Garola of 2013. The power company’s argument is that the Government has expropriated the plant and the law does not recognise the four year reprieve that has been granted.

 

Private planes and jets are under suspicion of the Spanish tax man, who thinks that some companies have been eluding the payment of taxes in a fiscal fraud which has been estimated at 25 million €. Many users could have hidden the fact they own a plane to elude the matriculation tax of 12% of the plane’s value and the 16% of IVA/VAT due.

Beach sun beds in Spain are lacking foreign visitors this year, with the number of foreign tourists down 11.4% for the first six months of the year compared to last. The Government has said it expects there to be ten percent fewer tourists on the beaches, with a consequent reduction for business in bars, restaurants and shops along the Costa’s.

 

Profits from the Sol Meliá hotel chain have fallen by 97% on the back of an 11.9% reduction in income. The company says the crisis is being noted particularly in urban hotels, which are suffering a fall in company trips, and meetings.

Rolling tobacco sales continue to soar, up by 68% in Spain over the past year. The government used its new popularity to increase tax on the product in June.

The BBVA has noted ‘clear signs of stabilisation’ in the Spanish economy, although the bank considers that there is no sustained recovery because measures such as the Government’s Local Investment Plan generate some uncertainties.
The bank considers that the end of 2009 will be key as that is when such measures end, and it considers there will be a significant fall in potential growth because of the lack of reforms carried out in the economy.

Latest data from the government shows that 28% of the population in Spain is buying more own brand or white label goods than a year ago. The products most in demand are pasta, beans, rice and dairy items. Men and youngsters are those leading the change to the cheaper goods, and nine out of ten households eat some of the goods.

Data for the month of June shows that domestic flights in Spain saw a 9.2% fall in traffic compared to the same month last year, while the AVE high speed train also saw a 7.8% drop in the number of passengers carried. The numbers come from the National Statistics Institute and also show a small fall in the use of local and regional transport services.

The Agencia Tributaria tax authorities anti fraud office saw a 9.5% increase in the amount of tax recovered in 2008 at over eight billion euros. 62% of the cases involved VAT/IVA fraud.
Meanwhile Hacienda says it has now paid out 87% of this year’s income tax rebates.

In an effort to win clients, German airline Lufthansa says it will return the cost of its flights to German clients if it rains while they are in Spain. The company has given an undertaking to pay 20 € per day if it rain at their destinations in Spain which include Barcelona, Bilbao, Madrid, Málaga, Palma and Valencia.

And finally,
Ice cream sales are resisting the crisis well this summer thanks to the high temperatures being seen. Producers say sales are only down by 2-3% since the start of the year.

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Tenerife still 'most popular destination' for foreign buyers

Spain is still the favourite destination for British people looking to move abroad and invest in foreign property, it has been claimed.
Les Calvert, director of the online investment portal Property Abroad, believes that the country's strength as a tourism destination means it will remain the ideal location to make a foreign purchase.
His comments come on the back of a survey by the Spanish Property Owners Guild, which revealed that prices could drop 15 per cent over the coming year.
Mr Calvert said, "Spain is still the most popular destination with overseas property buyers and that is almost completely undeniable.
"In the current economic climate, most people are buying-to-hold for the economic recovery and I would recommend buying a property in Spain, more so now than I would have a year ago."
Specifically, he identified Tenerife as a Spanish region where prices have continued to increase, despite the global economic climate, thus making the logical choice for a profitable investment in real estate.

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