There isn’t much going on in the property market at the moment. Most of the news seems to revolve around the budget and unemployment so I thought today I would give you a quick overview of the main stories across Spain.
Argentina seizes control of YPF
Argentine President Cristina Fernandez says she will “fulfil a life-long dream” to solve her country’s energy shortage by seizing control of YPF, Argentina’s biggest oil company, which also happens to be a subsidiary of Spain’s Repsol.
The oil giant is reported to be worth over 18 billion euros, with Repsols 57% share being valued at over 10 billion, a figure which Madrid will be looking to recuperate in compensation for the seizure. Under the seizure plans Repsol would be left with only 6% of the company.
Spain has threatened action against Argentina for nationalising the Spanish energy firm, but Argentina is already shut out of world debt markets and has repeatedly ignored international fines on previous occasions which makes it seem unlikely that Madrid will be satisfied with the outcome.
Spain tests markets with 10 year bonds
Spain is likely to pay dearly for it’s longer-term debt today as it auctions a 10-year bond for only the second time this year to markets already nervous that Spain will miss deficit targets and fail to restart growth.
The 10-year bond rose above 6 percent on Monday for the first time in five months, increasing concern that it could soon become unsustainable for the government to refinance itself.
Spain aims to raise 2.5 billion euros from the sale of bonds and with this relatively small auction demand is likely to be high.
King says sorry for hunting trip
Spain’s King Juan Carlos has made an unprecedented apology for taking his luxury hunting trip to shoot elephants while his country wallows in economic crisis comes.
“I am very sorry. I made a mistake and it won’t happen again,” the monarch told television reporters as he left hospital following an operation to repair his hip which he damaged during the hunting trip.
The monarch is also the honorary president of the Spanish arm of the WWF (World Wildlife Fund) and while the king was apologising, members of the group were deciding whether to remove him from the post. Hunting elephants for fun hardly fits the WWF ethos and many other animal rights groups also demanded his resignation from the post.
Increase in airport charges threatens tourism
Increased airport charges threaten Spanish tourism, a market on which many parts of the country depend.
The Alliance for Tourism Excellence, Exceltur, say that the “disproportionate” increase in charges could lead to the loss of up to 2.87 million Spanish and foreign tourists across the country’s airports.
The Association, which includes companies such as El Corte Ingles, Iberia, Amadeus and Barceló, estimates the loss of income could be as much as €1,636 million a year.
As most of the airlines have already seen increased oil prices chew into their profit margins this increase is likely to translate to increased ticket prices for travellers.
El Mundo reported that as operating costs for airlines are cheaper in other “attractive” destinations many operators, and tourists, will instead visit Turkey, Egypt, Morocco or Greece, places where the “sun and sea” holiday is also available.