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Catalan Independence: The Case For And Against - MBA Students Divided

As Catalan independence looms, two ex-students from a Barcelona-based business school argue the case for and against

Carles Puigdemont, the Catalan separatist leader, could declare independence from Spain today after 90% of participants in October 1st’s unilateral referendum voted for an independent Catalonia.

The implications for business and business schools in Catalonia could be significant. Already, CaixaBank, Spain's third-largest bank, and Catalan bank Sabadell have announced they’ll move their legal headquarters outside of the region.

The Spanish government’s brutal reaction to the October 1st referendum—seizing ballot boxes and battering peaceful voters with truncheons—brought back memories of General Franco’s Guardia Civil, and only strengthened the independence movement.

Yet, the independence referendum turnout was 43%—those who oppose independence likely ignored the vote. Recent demonstrations have shown strong support for a united Spain. And past polls show a community divided.

The MBA community in Barcelona is no different. BusinessBecause caught up with two ex-students from a Barcelona-based business school to find out more.

FOR

Pau Serrat Aguilar thinks Catalan independence is a risk worth taking. For Pau, a native Catalan, independence is about more than economics. He was outraged by the government’s reaction to the October 1st referendum.

Reaction

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“I’m shocked, mainly because I have always thought the ruling party in Spain to be strategic and intelligent in how they play their cards. For me, what they did with sending in the police was despicable. It was bad in terms of the action itself but also in terms of strategy.”

Argument for

“Spain is a country made up of many nations, peoples, and cultures, that have always aspired to rule themselves at some point—this system has worked well, more or less, for the past 40 years. However, the current government of Spain has neglected this principle. They have a different view of what Spain should be, and this vision collides directly with my own.

“I’m a profound defender of the Catalan language and culture, and I don’t think the strategy of this Spanish government is to foster this culture. Now in Catalonian schools, if just a single kid in a class demands to be taught in Spanish, then the whole class must be taught in Spanish by law.

“In economic terms, Catalonia has the largest GDP in Spain; it’s a rich region. But how can we explain that the region that provides the most GDP to the country is in permanent deficit? What’s going on here? I don’t believe its’s because of the management of the Catalan government, because they have cut like hell over the past years as well.

“For me, a fix of the tax system is needed urgently, but it seems that the Spanish government doesn’t want to talk about it”

Challenges

“The success of independence depends on the reaction of the countries around us. If it’s accepted, I think Catalonia would benefit out of Spain. Of course, if we start talking about boycotting Catalan products, then things change.

“It’s definitely a risk. I think, in the short-term, some companies would leave. But we have to remember that most traffic leaves Spain to France from Catalonia, and Barcelona is the second largest port in Spain. I don’t think it would be beneficial for other countries, especially Spain, to block Catalan commerce.

“Joining the EU will be a difficult process, but that doesn’t mean not being in the Schengen Agreement.” Countries outside the EU but in the free movement agreement include Iceland, Norway, and Switzerland.

“To be honest, I don’t think the effects of independence would be that significant.”

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AGAINST

John Adam Roberts, moved from Canada to pursue an MBA in Barcelona. He met his wife on the MBA. Now, he’s launching his own fintech startup based in Madrid. He fears that the Spanish government’s extreme reaction to the October 1st referendum could trigger Catalan independence

Reaction

“It’s not the first time this has happened. When I was studying in Barcelona in 2014, they had the same attempt at a vote. It’s just that this time the Spanish government decided to be more heavy handed, and so it’s getting more international news.

“As an outsider, the whole thing looks like a lot of people with a lot of opinions and not a lot of attempt to try and understand each other.

“At the moment, I think there’s an 80% chance that Spain will stay together; 20% of me thinks that Spain gets angry and things go to hell in a handbasket!”

Argument against

“I definitely get the sense that, even if independence is realistic politically, I’m not sure that it’s realistic or desirable socially. I think that a lot of the pro-separation arguments run into serious economic problems.

“We’ve already seen that Sabadell, a leading Catalan bank, has announced it’s moving its legal head office out of Catalonia to Alicante. When you have some steadfast Catalan organizations that say, ‘we don’t want to be part of this,’ then there’s definitely some infrastructure issues.”

Challenges?

“Even if Catalonia ends up in the EU in the future—and it’s a big if—even if the EU tries to fast-track Catalonia’s entry, at least for a couple of years, Catalonia won’t have access to a lot of EU infrastructure, and the free trade of labor and goods.

“I think that would severely hit them back. Once companies have spent money to move out of Catalonia, they’re unlikely to go back.

“As an entrepreneur, I wouldn’t want to be there now watching all of this going on. I do think there’ll be an exodus of startups. For VC investors, investing at startup stage is already risky enough. The last thing you want to add is political risk. In the next 10 to 15 years, that might be a difficult challenge.”

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