BARCELONA BRIEF - A TWICE MONTHLY ROUNDUP OF POL/ECON

UNCLAS SECTION 01 OF 02 BARCELONA 000020 SIPDIS STATE FOR EUR/WE MCKNIGHT AND ZERDECKI E.O. 12958: N/A TAGS: SP FR AN PGOV PNAT PREL KCOR ECON EINV ELAB SUBJECT: BARCELONA BRIEF - A TWICE MONTHLY ROUNDUP OF POL/ECON DEVELOPMENTS IN THE BARCELONA CONSULAR DISTRICT BARCELONA 00000020 001.3 OF 002 BARCELONA MAYOR TRIGGERS CONTROVERSY WITH 2022 WINTER OLYMPIC BID ¶1. (U) Barcelona Mayor Jordi Hereu's announcement that the city will bid for the 2022 Winter Olympics has sparked tension with the neighboring autonomous community of Aragon, which also seeks to host the Games. Hereu's surprise announcement last month caught many off guard, as Aragon's capital city, Zaragoza, had announced last October that it would submit a bid with the Pyrenees mountain towns of Jaca and Huesca to host the 2022 Games. Aragon officials are perturbed as Barcelona's plans to enter the Olympic fray present unexpected competition, and is indicative of a long standing historical rivalry between Aragon and neighboring Catalonia. Hereu, meanwhile, faces internal opposition, as the leftist eco-socialist party Initiative for Catalonia Greens (ICV) and the Catalonia Republican Left (ERC) parties both oppose the bid. ICV and ERC are partners with Hereu's Socialist Party of Catalonia (PSC) in the ruling tripartite government, but fault Hereu for not having consulted with other political leaders before making his Olympic announcement. Leaders from the opposition Popular Party (PP) and the center- right Convergence and Union Federation (CiU) have also expressed skepticism over Hereu's Olympic ambitions. Hereu is officially visiting Vancouver during the current Winter Games to further pursue Barcelona's bid. If successful, Barcelona would be the first city to host both the Summer and Winter Games. Zaragoza and Jaca failed in their attempt to host the 2014 Winter Games. FOOTBALL CLUB BARCELONA PRESIDENT TESTS POLITICAL WATERS ¶2. (U) Joan Laporta, president of the immensely popular Football Club Barcelona (FCB),is flirting with entering politics, with an eye on the Catalonia presidency to be contested this fall. Laporta is a Catalan nationalist strongly in favor of Catalan independence. Laporta's popularity in presiding over what many consider to be one of the greatest soccer teams of all time has potential political rivals concerned of his impact on the fall elections. Several scenarios are possible-Laporta could align himself with either one of the two main Catalan nationalist parties, the Catalan Republican Left (ERC) or the center-right Convergence and Union (CiU) federation. He has also reportedly held discussions with the upstart Reagrupament (Regrouping) association, which was founded by former ERC member Joan Carretero last October with Catalan independence as its main objective. Another possibility is that Laporta would create a new political party, which could further divide pro-independence voters. Laporta has been the president of FCB since 2003 and has utilized a mix of homegrown Catalan players and international superstars to become one of the top soccer teams in the world. In 2009 FCB won an unprecedented six Spanish, European, and international tournaments. CATALAN INDEPENDENCE REFERENDUMS CONTINUE ¶3. (U) Several more rounds of unofficial referendums on Catalan Independence will be held on February 28, April 5 and possibly June 20. The February referendum will be held in 77 municipalities, which include approximately 300,000 potential voters. The proposed June 20 referendum could include Barcelona suburbs, the first time that such an event would be held in the metropolitan area. The symbolic vote for independence follows a similar event held in December in 167 small Catalan towns, and a referendum on Catalan National Day, September 11 in one small town. While only 27% of voters participated in the December referendum, over 90% were in favor of independence. The December 13 referendum and its predecessor on Catalan National Day have generated a great deal of national and even international attention, and help fuel internal debate on Catalonia's relationship with the rest of Spain, pending the Spanish Constitutional Court's decision on the Statute of Autonomy. The practical impact of the symbolic referendums is limited, however, and Catalonia's two main nationalist parties are at odds over a proposed new law to govern the referendums. The pro-independence Catalonia Republican Left (ERC) has proposed a law to regulate the popular referendums, while the center-right Convergence and Union (CiU) federation opposes the proposal. GENERAL MOTORS SPAIN TO LAY-OFF 900 WORKERS IN ARAGON BARCELONA 00000020 002.3 OF 002 ¶4. (U) General Motors' Opel plant in Figueruelas, near the Aragon city of Zaragoza, plans to lay-off 900 workers and temporarily suspend 600 night shifts as part of a cost-cutting plan. GM says that the restructuring of its Figueruelas plant workforce will be "socially responsible", avoiding any abrupt dismissals. The layoffs of 900 workers will happen gradually, with the final wave in February of 2013. GM blames low sales in Western Europe, where the company envisions laying off a total of 8,300 workers. On February 10 Opel management staff and labor unions met to negotiate the terms of reincorporation of the 900 laid-off workers. The unions have asked that 350 permanent employees be asked to leave on a voluntary basis, and that once sales improve, they would be allowed to return to the factory guaranteed the same salary and benefits. GM has proposed a salary freeze for these workers until 2013, which the unions have rejected. This is the latest restructuring move that GM has made in Aragon. Last fall GM decided to keep the Figueruelas plant, rather than sell it to Magna, a German car company that would have likely transferred production to Eastern Europe. The Opel Zaragoza plant exports cars to 72 countries, with 75% of the production going abroad. CORRUPTION SCANDAL ROCKS MALLORCAN POLITICS ¶5. (U) Francesc Antich, the president of the Balearic Islands Govern (central government),has removed all high-ranking members of the Mallorcan Union (MU) party from the government after the arrest of five MU officials for corruption allegations related to the Institute of Tourism Strategy (Inestur),a unit within the Balearic Ministry of Tourism. In the investigation, known as Operation Vulture, Mallorcan anti-corruption police arrested the five MU officials on charges including fraud, misappropriation of public funds, prevarication, bribery, and coercion. Businesses and other entities related to the MU alleged received up to 2.5 million Euros ($3.4 million) through bogus documents. Mallorcan police have investigated at least 25 individuals and 23 businesses as part of Operation Vulture. The mayor of Palma de Mallorca and the president of Mallorca have followed suit, sacking MU members from the Palma City Council and the Council of Mallorca, thus removing MU from all three government institutions on the islands. The Socialist Party of the Balearic Islands (PSIB ) and the Bloc for Mallorca, who once held a majority coalition with the MU, have agreed to a minority rule in all three institutions. Antich plans to take advantage of the scandal by restructuring the Govern and reducing the size of the ministries. He has dismissed the idea of holding emergency elections in order to avoid further public doubt. Miquel Nadal, the former minister of Tourism and leader of the MU is the most senior official arrested. He had previously been implicated in two other corruption cases, which led to his resignation last December. The Popular Party (PP) has been threatening Antich on and off with a possible censure. SARKOZY TO MAKE AN OFFICIAL VISIT TO ANDORRA ¶6. (U) At a meeting in Paris on February 4 with Andorran Head of Government Jaume Bartumeu and Andorran President of the General Council (Parliament) Josep Dalleres, French President and Co-Prince of Andorra Nicolas Sarkozy announced that he would make an official visit to the small Pyrenean nation some time before this summer. Sarkozy4s visit would be the first a French head of state has made to Andorra in the past 13 years, the last being Jacques Chirac in 1997. During their February 4 meeting, Bartumeu and Dalleres informed Sarkozy of Andorra's advances in exchanging tax information with the approval of a new law and the signing of ten accords. President Sarkozy said that he was convinced by the steps Andorra has taken, and encouraged the country to "continue along the route of transparency by this exchanging of information." Sarkozy's announcement is important for Andorra after Sarkozy had threatened last year to abdicate his position as Co-Prince if Andorra did not take action to remove itself from the OECD list of tax havens. Sarkozy, who at that time was preparing for last April's G-20 summit in London and a proponent of combating tax havens, did not want to be seen as claiming to fight money laundering while also serving as the Co-Prince of a country on the OECD list. Andorran officials are pleased with Sarkozy's announcement and for French assistance in helping fight money laundering. CROUCH