Local chemicals leader urges Catalonia dialogue

04 October 2017 22:33 Source:ICIS Chemical Business

The president of the Port of Tarragona, where one of Spain’s largest chemical parks is located, urged Catalan and Spanish leaders to establish a serious dialogue to return to normality, following the snap tumultuous vote on independence held in the northeast region.

The Spanish stock exchange traded lower on 2 October and the euro dipped slightly against other major currencies following the snap vote, which had not been agreed with the central government and was declared illegal by the Spanish constitutional court.

Catalonia’s Port of Tarragona is key for the Spanish chemical industry as it hosts the ChemMed chemical park, which employs more than 10,000 people and has among its companies global majors like BASF, DowDuPont, Covestro, as well as Spain’s energy major Repsol or firms like ELIX Polymers, Ercros or IQOXE.

Josep Andreu, the Port’s president, urged political leaders in Madrid and Barcelona – the Catalan capital – to negotiate and unblock the current impasse, which could see the region declaring independence within days, according to the regional president late on 30 September.

“I trust that in the end the rationality will prevail. The events occurred yesterday in Catalonia are deeply concerning and we are very worried. The central government in Madrid needs to think very carefully about the next steps, but we hope all the work we have done [with both governments] in the Port will not be thrown away,” said Andreu.

INDEPENDENCE IS AN OPTION

“Independence may be an option in the future, but right now the feelings are too strong, the debate is more heart than head, and there are too many emotional arguments and too few rational ones.”

After the last months’ political tension, which culminated in the vote, analysts have said a legally-bounding referendum, whose terms would be agreed with the central government, may be on the cards in the medium-term.

Although opinion polls have consistently showed the majority of Catalans support holding a referendum on independence, they have also showed the majority of them would vote against it. However, sources in the industry and political analysts alike have said following the violent scenes during the vote, those feelings may change.

A petrochemical trading source attending the European Petrochemical Association (EPCA) annual meeting said to ICIS: “I’m afraid they [the police and the government in Madrid] may have woken up the beast for good.”

Port of Tarragona’s Andreu said, however, that he wanted “and needed” to remain optimistic and hoped for a negotiated exit to the current political – and social – turmoil.

CATALONIA DEBATE REQUIRED

Moreover, he asked for a “proper debate” about the pros and cons of an independent Catalonia, a debate so far absent as the two sides of the argument have actually not debated at all.

“At some point, somebody will have to explain the questions that could affect an independent Catalonia. There are so many questions answered, like the type of taxing system the new country would have, how to manage the logistics and the infrastructures like ports or airports,” he said.

“Companies want legal security for their businesses, and undoubtedly a potential independent Catalonia would be a new scenario about which they don’t know much about yet, and that would cause a lot of uncertainty. In general, big companies would always favour the status quo.”

He concluded by saying that while the Catalans who attempted to vote may be passionate nationalists, “we don’t know what other parts” of the region’s society thinks as they may not be as outspoken as those wanting an independent country. Whatever the case, he recognised the tension has gone too far and the emotions should be tamed down.

“I want to be optimistic. I need to be optimistic. You can’t manage a country only with emotions so what I want is for the two governments [Catalan and central] to sit down and start an immediate dialogue about future steps,” he said.

PORT OF TARRAGONA FOCUS

Whatever the outcome of this turbulent week for Spain is, Andreu said he will continue to be focused in securing for the Port of Tarragona the infrastructure it needs and lobby for lower electricity costs for the companies present at the site.

In a common plea with the Spanish chemical trade group FEIQUE and the country’s main trade unions, as well as corporates like energy major Cepsa, Andreu showed some satisfaction for the progress made with a new railway to connect the Port’s site with the rest of Europe due to be started up in 2020.

While currently there is a connection with France through the Pyrenees the tracks width is different from those in the rest of Europe following an isolationist Spanish policy dating back to the 19th century. While mostly-passenger high-speed lines have already adopted the European width, cargo from Tarragona gets delivered slower for the logistics problems presented by the width at the French border.

“I think we are advancing, not with the speed we would like, but there has been progress anyway. They new railway is to open in 2020, for example. However, companies at the Port and the petrochemical site still need lower electricity costs, which is a drag in our competitiveness compared to other European peers,” said Andreu.

“We are lobbying for a system which follows the German model, where the energy produced within a site can be used at the site. Currently, a lot of companies at the Port produce energy but that power is sent back to the national grid, and when it returns it does so at a much higher price.

By Jonathan Lopez