Catalan businesses back a federal model

Four months ahead of the date set by Catalan nationalists for a referendum on self-rule, regional business leaders are championing a third way that would secure greater power for Catalonia yet fall shy of outright independence.

The heads of major Catalan companies have been upping their contact with politicians and entrepreneurs in Madrid, in a bid to convince Prime Minister Mariano Rajoy of the Popular Party (PP) to make a move that will unblock bilateral relations.

They have even sent La Moncloa, the seat of government, specific proposals for a federal form of government that is reminiscent of an earlier proposal by the Socialist Party.

The idea is to find a more moderate solution that everyone can agree on and head off the threat of outright independence, which many entrepreneurs view as bad for business.

Business leaders have also asked the Spanish king to act as mediator in the conflict

While Catalan business leaders appreciate the announcement that Rajoy and Catalan premier Artur Mas will meet after a months-long freeze on relations, they are skeptical as to the actual results of that meeting.

Of particular concern is the fact that if no progress is made over the summer, Catalan nationalists will organize a new mass demonstration on September 11, Catalonia Day. The regional assembly will vote on a special law enabling the referendum, and Catalans will be asked to go to the polls on November 9.

On June 20, at a business dinner in Oviedo, the head of the Fomento de Trabajo employers¡¯ association set out the four pillars of this alternative model. Joaquim Gay de Montell¨¤ said that Catalonia must be recognized as a nation, an option that would require altering the Spanish Constitution; the region must be granted full control over language policies and culture, as well as its own tax agency and have full ability to organize itself at the local level.

While these demands have come to Rajoy¡¯s attention, sources familiar with the situation said that the conservative government is stuck on ¡°no.¡± A businessman who spoke on condition of anonymity said that the prime minister is surrounded by ¡°an army¡± of attorneys who keep reminding him that the unilaterally designated Catalan referendum is illegal.

Catalans will be asked to go to the polls on November 9 to give their opinion on self-rule

This past year has seen a profusion of reports analyzing how secession would influence Catalonia¡¯s economy. The last one, by the Barcelona Chamber of Commerce, says that it would mostly affect big corporations and finance.

Business leaders have also asked the Spanish king to act as mediator in the conflict, even as parties in the center of the political spectrum have been losing ground. The Catalan Socialist Party, the main supporter of a third solution, has struggled with internal disputes over the issue of self-rule and its leader, Pere Navarro, resigned.

But former Catalan premier Jos¨¦ Montilla, a Socialist, says that parties should not let themselves get carried away by the pro-sovereignty tide or ¡°follow the leader depending on the circumstances.¡±

All eyes are now trained on the upcoming meeting between Rajoy and Mas. But there is little room for hope. One leading member of the Catalan executive said that ¡°the [Spanish] government is not going to offer Catalonia anything, we are convinced of that.¡±