How to invest in the Catalan economy
With the European Central Bank’s €50bn bond buy-back programme, Catalans can now buy into the economy with the first buy-backs in the region’s history.
What you need to know about the ECB’s buy-out programme article With a market capitalisation of around €80bn, Catalonia is the world’s eighth-largest economy and one of the regions largest employers.
With the buy-up, the Catalan government will invest €5.5bn to help the country’s financial sector.
The rest of the money will be spent on public spending, health and education, and infrastructure.
It is the first time that the government has used the buyback programme to help businesses.
“This is the right time to use the ECBs buy-bond programme to stimulate the Catalan sector, to support the local economy and to strengthen the competitiveness of Catalonia,” Catalonia’s Economy Minister Jordi Turull said in a statement.
“We are ready to use these funds to support businesses and ensure that we can attract investment from around the world, which is our core mission.”
In the run-up to the bond buyback, Catalonia had already used a similar programme to finance a €10bn loan to Spanish banks.
“With this bond buyup, we will be able to increase our own investment and help strengthen our economy,” the Catalan finance minister added.
What the buybacks will do for Catalonia The buy-ups will also see Catalonia spend more on public services, with the government’s overall expenditure on services on a per capita basis rising from 3.4% in 2017 to 5.9% in 2019.
The government will also spend around €6.4bn on public infrastructure projects, such as roads and bridges, which will see the region expand its road network and provide new facilities for the people.
These projects will be funded by the Spanish government and will contribute to the countrys economy.
In the first half of 2019, the Catalans government expects to spend around 3.2% of its GDP on social spending.
This is the same as in 2017, the same amount of spending on health and social services.
What’s more, the buyouts will allow the government to increase spending on education and health care, and will allow them to fund the construction of public hospitals.
In addition, the central government will receive a 5% tax cut in 2019 on purchases of property and equipment, which should result in a 1.4 billion euro gain for the Catalan public purse.
How the buyout programme is different from other buy-ins Spain’s central government has spent nearly €4tn on its buy-outs in recent years.
The Central Bank has already invested in the housing market and has made large purchases of shares and bonds to support Spain’s economy.
“The buy-in is a clear signal of the central bank’s intention to boost the Spanish economy,” economist Sergio Pinhas said.
“If the buyin proceeds, the economic output and growth will improve.
That is what we expect, given that the buyins are expected to add to Spain’s GDP in the next two years.”
But how the buyings will work in practice Catalonia is a small region.
Its economy is only slightly larger than Spain’s and it has a population of only a million.
Its debt burden is just 1.5% of GDP.
So, while the government is hoping that the bond purchases will be a positive signal for Catalonia, the government will need to invest its own money.
The buyout is a new approach to a previous buy-on, which had involved the central governments of Portugal and Ireland.
That strategy allowed the governments to buy up large amounts of debt in a single, public buy-off.
The bond buyout will be the first of its kind in the world.
The purchase of bonds in Spain was first undertaken by the government in the early 2000s.
Since then, a total of 13 countries have followed suit.