Analysts: firms’ leaving Catalonia to hurt economy

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At least four Spanish companies have planned to move their legal base out of Catalonia as the industrialized region considers declaring independence. Analyst said the move would cause devastating economic consequences in Catalonia.

Barcelona based pharmaceutical company Oryzon is the first listed company to announce that it is moving their base to Madrid.

The company said it needs a stable environment to run the business, and also an EU membership to maintain the dialogue with regulatory bodies.

Other top Spanish companies such as Banco Sabadell, the fourth largest bank in Spain, textile company Dogi International, and utility company Gas Natural Fenosa are also deciding whether to stay or not.

Spain's Economy Minister Luis de Guindos. /VCG Photo

Spain's Minister of Economy blamed the Catalan government for the moving, and said that was the consequence of the policies put in place by the regional government.

“It is illegal. It's irrational. It is detrimental to the Catalan economy,” said the Minister of Economy Luis De Guindos, “We have seen decisions taken by a lot of corporations. This is basically our point. We have a very clear message that the policies implemented by the regional government of Catalonia are detrimental to the economy of Catalonia."

Jose Luis Feito, president of the Institute of Economic Studies also believed that the main consequences of this “illegal action” on behalf of independence will be mainly felt on the economy of Catalonia.

“An independent Catalonia will be outside of the European Union and outside of the common currency,” said Feito, “what companies are doing in Catalonia, particularly banks, are obviously protecting themselves and their customers and their shareholders from this possibility."

Spanish utility Gas Natural Fenosa's headquarters in Barcelona /VCG Photo

Multinational companies are also expected to be affected by the political event. Catalonia is not only a hub for industry and tourism, accounting for a fifth of Spain's economic output, but also a production base for major multinationals from Volkswagen to Nestle and home to Europe's fastest-growing sea port.

Volkswagen's Spanish unit Seat SA employs 14,000 workers at its three production centers in the region. Seat was forced to briefly close one production line when referendum-related protests disrupted its supply chain.

Nissan also has a factory in Catalonia that employs about 2,000 workers. Other companies such as Nestle and Hewlett Packard have operations in the region as well.

None of those companies have said that they intend to move any staff or operations.