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Moody’s: Catalonia’s independence would damage Spanish economy

Staff Writer | September 12, 2017
Moody’s said that the Catalan independence bid could have negative consequences on the overall Spanish economy and its sovereign rating.
Catalan independence process
Europe   The Catalan independence process
The agency is suggesting a solution could lay in resolving certain fiscal and financial issues.

In its report, Moody’s reviewed the Catalan independence process, keeping in mind Catalonia’s size, that it represents 19 percent of Spain’s Gross National Product and 16 percent of the Spanish population, with a per capita income slightly above the country’s national average.

Catalonia’s “independence would weaken the strength of the Spanish economy,” the rating agency pointed out.

Moody’s next Spanish financial outlook review is due Oct. 20.

However, the ratings agency confirmed its future forecast will be based on the premise that the separatist process will not succeed and Catalonia will remain in Spain.

The presence of numerous obstacles to Catalan independence was noted, such as Spain’s constitutional safeguards or the fact the secessionist movement does not count with an overwhelming majority.

Even in the event the independence referendum did take place on Oct. 1 and the secessionist vote succeeded, “the lack of any legal foundation and the absence of a minimum voting percentage would undermine its legitimacy,” the agency said.