Catalonia faces 10 percent tourism hit in fourth quarter

A woman with an 'Estelada', the pro-independence Catalan flag draped over her shoulder, pastes banners on a wall that read in Catalan: "Freedom for the Political Prisoners" during a protest against the decision of a judge to jail ex-members of the Catalan government at the University square in Barcelona, Spain, Sunday, Nov. 5, 2017. A Spanish judge issued an international arrest warrant on Friday for former members of the Catalan Cabinet who were last seen in Brussels, including the ousted separatist leader Carles Puigdemont, who said he was prepared to run for his old job even while battling extradition in Belgium. (AP Photo/Manu Fernandez)
A girl pastes a banner on a wall that reads in Catalan: "Freedom for the Political Prisoners", during a protest against the decision of a judge to jail ex-members of the Catalan government at the University square in Barcelona, Spain, Sunday, Nov. 5, 2017. A Spanish judge issued an international arrest warrant on Friday for former members of the Catalan Cabinet who were last seen in Brussels, including the ousted separatist leader Carles Puigdemont, who said he was prepared to run for his old job even while battling extradition in Belgium. (AP Photo/Manu Fernandez)

LONDON — The restive Spanish region of Catalonia faces a potential $500 million financial hit in the fourth quarter as business-related travel dips following the attack in Barcelona and the uncertainty generated by the disputed independence referendum.

In an interview Monday with The Associated Press at the World Travel Market in London, Catalonia's top tourism official Patrick Torrent said the region will likely see a 10-12 percent fall in tourist numbers during the fourth quarter, which accounts for around 15 percent of annual tourism revenues.

That level of decline which would equate to around 450 million euros, Torrent said, with the large bulk of the fall related to a drop-off in business travel to events such as conventions.

Despite the anticipated fourth-quarter decline, the executive director at the Catalan Tourist Board, said Catalonia is set to see revenues this year outstrip those last year and that the expectation is that revenues will rise again next.

However, more insight will emerge at the turn of the year when the bulk of pre-reservations are made. His staff, he said, are "on alert" about the impact on the main booking season.

The worry among many economists is that deteriorating business environment in Catalonia, which has seen around 1,500 firms move their headquarters out of the region, could worsen further amid all the uncertainty. Credit ratings agency Moody's has warned that the region's financial recovery is being jeopardized

"Moody's believes that the political instability will negatively affect the region's economy, in particular foreign investor sentiment and the tourism sector, and add pressure to the region's already weak finances," it said last week.

The Catalan tourism industry, a key income generator in what is Spain's richest region, has had a difficult few months. After the August attacks in Barcelona and a nearby town that saw 16 people killed, the region has been embroiled in a battle of wills with Spain over the disputed independence referendum in early October which prompted Madrid to impose direct rule and seek the arrest of members of the Catalan government, including its leader, Carles Puigdemont, who has fled to Brussels.

The impact of the attack in Barcelona on holiday travelers was short-lived, according to Torrent, and "less important" than other cities in Europe, such as Brussels or Paris.

"The perception of Barcelona and Catalonia as a safe destination has not suffered any impact," he said, noting figures showing tourism numbers higher in September.

Torrent said he met up with Alvaro Nadal, the Spanish minister of energy, tourism and digital matters, on Monday for the first time since the triggering of Article 155 of the Spanish Constitution which imposed direct rule on Catalonia.

Torrent said the Spanish government has made no requirements upon him or his staff and that it is "business as usual" until an early Catalan regional election on Dec. 21.

"It's not intervention. It's more a kind of coordination," he said. "It's easy, it's not complicated, with good relations without problems, at this moment."

Before direct rule, Torrent would speak with Spanish tourism officials two or three times a month. Now, it's that amount of times a week.

Torrent urged all participants in upcoming demonstrations in Catalonia before the election, including one this Saturday, to remain peaceful and law-abiding.

"It's important to say that our streets are normal, our restaurants are working as usual, our destination is exactly the same situation," Torrent said.

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