Spain to lose 20% of its economy if Catalonia splits
The Spanish region of Catalonia held a controversial independence referendum on October 1. Voting went ahead although the Spanish highest court had declared the referendum unconstitutional, and in spite of the disruption to actual balloting by the Spanish police.
According to CNN Money, Catalonia accounts for about 20% of Spain's economy, and leads all regions in producing 25% of the country's exports. The region contributes much more in taxes (21% of the country's total) than it gets back from the government.
Independence supporters have seized on the imbalance, arguing that stopping transfers to Madrid would turn Catalonia's budget deficit into a surplus.
Catalonia has a proven record of attracting investment, with nearly a third of all foreign companies in Spain choosing the regional capital of Barcelona as their base. Volkswagen and Nissan, for example, both have plants near Barcelona.
Both sides of the political divide face significant business and financial risks. An independent Catalonia that drops out of the European Union will see the costs of its imports and exports go up. On the part of Spain, business confidence will likely plummet and Catalonia might decline its share of the current public debt. was concentrated in only a few countries between 2014 and 2016. 73% of FDI to Africa went to 10 countries.
The report warns that these trends are unfolding at the worst possible time, given the need and opportunity to harness Africa's 'demographic dividend.' The continent's population is set to double by 2050. Increased investments from aid, private flows and domestic resources are required to finance the education, employment and empowerment of this growing youth population. According to leading economists, Africa's youth is pivotal to lift the least developed countries out of poverty, accelerate sustainability and build long-term prosperity.