Spain through the looking glass

Archive for the ‘competitiveness’ Category

The Good Book

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I went to Toledo a day late.

I visited Toledo on Sunday instead of Saturday because Spain’s national railway company Renfe couldn’t get its act together to sell me a ticket.

Whole volumes could be written about the vagaries of of rail travel in Spain but I promise to keep my rant as short: my trip to Toledo was delayed a by 24 hours because none of the ticket machines at Madrid’s Atocha station were working, and because the staff in the ticket office seemed more interested in chatting with each other than flogging off tickets for the 10:20 to Toledo.

You can imagine the scene: crowds of confused tourists, irate Spanish grandmothers in fur coats, a slightly nervous, slightly overweight security guard. The minutes ticking away. I missed the train.

My first official complaint in Spain.

My first official complaint in Spain.

Anyway, it turned out the Saturday trip down to Atocha station wasn’t entirely fruitless. I didn’t make the train but I did have the pleasure of filling in my first bona fide complaint in all my years in Spain. That’s right: I actually resorted to the hoja de reclamaciones, or the official complaints book.

If you’ve spent any time in Spain, you’ve probably been vaguely aware of the existence of such things. These books — part of this country’s rickety consumer rights infrastructure —provide a way for people to vent their frustrations over anything from cheating taxi drivers to churlish taxidermists. In Andalusia, for example, the hojas are actually obligatory for all businesses, whether they be a religious artifacts shop or a first communion fashion store or a flamenco designer’s boutique.

After a while, you don’t really see these little signs, in that same way you don’t — in a bar — notice all the posters of waxy-looking Jesuses decked out in crowns of thorns or the mouldering stuffed bulls’ heads that line the walls. So it is with the hoja de reclamaciones.

But last Saturday at Atocha station I entered into the fray of civil society and demanded The Book. Driven along by indignado rage, I stormed into the Renfe customer service centre and noted down my litany of frustrations into a purple A4 jotter which felt like something you might use to decorate the set of a television show about a 1950s advertising firm. My complaint was then carbon-copied in quadruplicate — seriously – before each individual copy was decorated with a seal.

The Renfe staff on duty could not have been less interested. They handed me the book almost wordlessly and then silently presented me with two copies for my records. It set me wondering how many millions of these complaints forms have been filled out and filed away in dusty cabinets over the decades. Will anything ever come of my grievance? I wait with not-very-bated breath.

And Toledo? Well, given that – for reasons which remain mysterious — all Spanish towns have to be the capital of something, I can safely report back that Toledo appears to be the capital of Marzipan and swordmaking. Neither of these were items that I particularly felt like buying last Sunday, but it did occur to me a day or two later that some sort of sabre might have come in handy at the ticket office at Atocha station.


Written by georgemills25

March 16, 2013 at 10:14

Talking rubbish

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For the last few nights, Seville has been preternaturally quiet. Eerily so.

Generally I fall asleep here to the symphonic thud and thump of municipal street cleaners emptying the dozen or so garbage containers that line our street. Since last Sunday, though, the garbage collectors have been on strike. The result? A disconcerting – very un-Sevillian – silence between midnight and dawn. It’s almost too quiet to sleep.

At first, the strike didn’t bother anyone much, and one group was positively delighted: the city’s  garbage scavengers (and de facto recyclers). With the street cleaners out of the picture, they could rake through trash bags that were now conveniently piled up on the street instead of being buried deep inside a dumpster. It was a bonanza, but a short-lived one. Even the rubbish hunters are now struggling with the smell.


Today is day 9 of Seville’s rubbish strike; there are mountains of plastic bags on every corner, like postmodern sculptures only more interesting.

The rubbish story has been brewing since last year and involves a dispute between Seville’s town hall and workers at the city’s publicly-owned cleaning company Lipassam. The sticking points in negotiations between the two parties are holiday pay (reduced) and working hours (extended to 37.5 hours a week).

You might think the Sevillianos feel some solidarity with the poor fluorescent-jacketed workers of Lipassam; theirs is not a job I’d particularly want, and they are – after all – being asked to work more hours for less money. However, the handful of people I’ve talked to seem to think the city’s cleaners are little more than a pack of thieving whingers. The reason? They earn too much (and must therefore somehow be cheating the system, or so is the inference in this pathologically distrustful country).

Anyway, the town hall says the average annual wage for a member of the city’s garbage crews is €30,885 (around £25,000 or $US42,000) To put this in perspective, the average gross salary in Spain for 2010 – the last year for which figures are available – was €22.790,20 while El Publico pointed the most common salary that year was actually only around €15,500. So the Lipassam workers are doing quite well.

Apparently – and again this only according to my completely unscientific straw poll – these workers should therefore be happy with their lot. More than one person I spoke to suggested the Lipassam workers should be fired to a man/woman and replaced with some of those members of the 6 million-strong army of unemployed people in Spain who would happily work for far less than €30,885.

Sad days in Spain when non/workers turn upon non/workers.

Meanwhile, it has to be said that Lipassam’s own staff have not been terribly effective at making friends and influencing people. Several days ago, El Mundo newspaper published photos of cleaners demonstrating by littering the streets with scraps of paper they had no intention of picking up. Bad call guys.

And how do I feel? Oddly enough, I’ve been enjoying this garbage strike. It adds a touch of drama to the streets, and operates as a visual (and olfactory) counterpoint to the corruption scandal that has hit Spain’s ruling Popular Party in the last few days. In fact, I’m happy for the mountains of rubbish bags to grow so high that I have to wade through them – so high in fact that I can’t even see the horrible eyesore that is the new Cajasol Tower. That would be something.

Written by georgemills25

February 6, 2013 at 09:29

Competition watchdog busts telcos

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I can’t resist a touch of schadenfreude here: three of Spain’s largest telcos in Orange, Vodafone and Telefónica have just been slapped with whopping fines by Spain’s Competition Commission (the CNC).

The penalties totalling close to €120 million were imposed for anti-competitive strategies on SMS pricing from 2000 to 2009.

Detailing its decision to punish the unholy trinity, the CNC’s investigations Division said that the three operators had abused their dominant market position in those years by charging whatever they liked for SMS and MMS termination fees.

The competition watchdog said this had not only artificially lifted end-prices for consumers but had also priced virtual operators out of the market.

Telefónica will now have to shell out €46,490,000 while Vodafone is staring down the barrel at a fine of €43,525,000. Orange will be let off relatively lightly with a bill of €29,950,000.

I will be curious to see if the companies pay up on time.

And before I am accused of random corporate bashing, I do genuinely believe that mobile telephony pricing in the first world is nothing short of scandalous. The prices and service standards of Spanish telcos are also worse than those I have experienced anywhere else.

Written by georgemills25

December 20, 2012 at 16:09

Madrid business school named Europe’s best

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Madrid’s IE Business School has just been named Europe’s best by the Financial Times while two other Spanish institutes also help round out the UK business daily’s top ten.

In a crisis-bucking trend, Madrid’s prestigious IE moved up the FT’s business school rankings three places from last year’s number 4 spot. By doing so, the school also managed to knock France’s HEC Paris off a lofty perch it had held for six straight years.

There was even more good news for Spain with the University of Navarra’s IESE Business School claiming the FT’s number 6 spot and Barcelona’s ESADE coming in at number 7.

The Financial Times bases its ranking on schools’ performance across five programs – MBAs, executive MBAs, masters in management and open and custom executive education. To do this, the paper looks at the average salaries of graduates once they are three years out of the school but also awards extra points to school with a more international student mix.

Faculties get extra brownie points if they can boast of higher percentages of women and foreign teachers on staff while having a higher proportion of teachers with doctorates also pushes up a school’s rankings.

IE greeted the news of the Financial Times gong by saying the result consolidated their position as one of the best business schools in the world in terms of postgraduate education in business management.

Meanwhile, ESADE dean Alfons Sauquet told La Vanguardia newspaper that the result reflected the school’s dedication to excellence and its capacity to adapt in times of crisis.

Written by georgemills25

December 5, 2012 at 21:03

Iberia staff to strike in Christmas lead-up

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Staff at Spain’s national carrier Iberia will be striking in December to protest against airline plans to slash workforce numbers by around a quarter.

Unionised staff at the national carrier will walk off the job on the 14,17,18,19,20 and 21 of December to vent their anger at management plans to scrap 4,500 jobs and cut the salaries of remaining staff by as much as 35 per cent.

The unions say they have chosen the six days of their strike to minimise disruption to Christmas traffic and avoid busy weekend periods. Ground crew and cabin staff will be downing tool but pilots will clock on as usual during the rolling stoppages.

Iberia’s owner International Airlines Group announced a major revamp of the airline’s operations earlier this month in a bid to stop the profit rot. The company reported third quarter operating profits of €270 million this year, down from the €363 million notched up by the company in 2011.

The holding company – also owners of British Airways – said it now planned to stage a return to profits by cutting staff numbers and scaling down Iberia’s network capacity by 15 percent in 2013. They also plan to slim down their fleet by 25 planes and focus on the airline’s most profitable routes.

Responding today to news of the stop-work, Iberia chief executive Rafael Sánchez-Lozano told Europapress: ‘The strike at Iberia is like a hunger strike, if you win you die’. Clearly in combat mode, the airline boss also said he couldn’t see the advantage in a strike that would damage both the product and the brand.

Sánchez-Lozano added that Iberia would take a responsible attitude to talks with staff and was willing to listen to all options including ways to save on job losses ‘given that every person has a mortgage, or a school to pay’. He said, however, that the airline’s objective of return on equity of 12 per cent by 2015 was non-negotiable.

IAG have set a January 31 deadline for unions negotiations over planned changes at the carrier.

Written by georgemills25

November 29, 2012 at 14:02

Banks secure EC bailout

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The European Commission today agreed to a €37-billion bailout of four troubled Spanish banks but there are some serious strings attached.

The tough conditions imposed by the EU for the bailout mean the Banco de Valencia will soon cease to exist while Novagalicia Banco faces a sell-off within the next five years.

Meanwhile, the other two nationalised lenders – Bankia and Catalunya Caixa – will be forced to slash staff and branch numbers to meet strict cost-cutting requirements imposed by the EC.

In a move that Commission Vice-President in charge of competition policy Joaquín Almunia called “a milestone” in cooperation between the euro area countries and Spain, the EC has rubber stamped the restructuring plans of Spain’s four nationalised banks in Bankia, Catalunya Caixa, Novagalicia Banco and the Banco de Valencia.

In a press release earlier of today, the commission stated: ‘The in-depth restructuring undergone by BFA/Bankia, Catalunya Caixa and Novagalicia Banco will allow them to become viable in the long-term without continued state support. Moreover, the banks and their stakeholders [will] adequately contribute to the costs of restructuring.’

But the same press release also handed a death sentence to Banco de Valencia with the commission saying the viability of that institution ‘could not be restored on a standalone basis’. According to plans drawn up by Spain’s Fund for Orderly Bank Restructuring (or FROB) – the legal body charged with overseeing the overhaul of Spain’s banking sector – the bank will now receive €4.5 billion in funding before being sold onto giant CaixaBank for the less than princely sum of €1.

The EC deal also means the eventual sale of Novagalicia Banco with Spain committed to a sell-off of the institution by the end of the five-year restructuring period.

And while both Bankia and Catalunya Caixa have been handed stays of execution, they face a tough road ahead. The EC has given the lenders until 2017 to slash their balance sheets ‘by more than 60 per cent’ compared to 2010 levels. The banks will also have to stay well away from real estate lending and refocus their lending activities towards retail banking and loans to SMEs.

Under EC rules, the banks will also have to shed various industrial equity stakes and subsidiaries to limit a future need for aid. Bankia and Catalunya Banc will also have to wave goodbye to trading and treasury portfolio of fixed-income securities.

In Spain, the aftershocks of the announcement were felt almost immediately with Bankia quickly announcing dramatic plans to lay off 28 per cent of its workforce through the slashing of 6,000 jobs. The bank will also turn off the lights for the last time in over 1,000 offices as it rushes to meet EC requirements.

It was the failure of Bankia last May that initially led to Madrid to enter into negotiations with the EC for a €100 billion bank bailout.

The funds for the bank bailout will come from the eurozone’s European Stability Mechanism.

Written by georgemills25

November 28, 2012 at 16:03

One-man army

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Graffiti, Seville, Spain. ‘We’re not going to pay your debt.’

Although he’d be mortified to hear me say it, one man on our street is in engaged in a single-handed war against the crisis.

José isn’t taking part in Spain’s general strike today. He’d certainly be out there if he could. It’s just that the large company he works for have sent him to the boondocks on an all-day training course. He smiles wryly when he tells me this. He knows exactly what’s going on and he knows that I get it too. He’s just too much of a gentleman to make the connection explicit.

José is an elegant fellow in his mid-forties who runs the narrow-fronted furniture store a few doors down from my place. From behind an over-sized pine desk, he sells very reasonably-priced furniture that is neither fashionable nor dumpy. His shop is almost never empty. Whenever I stroll past, there’s a young couple in there checking out beds, or maybe a family testing out a sofa. You see, José has a killer sales tactic: he’s honest. In fact, he might just be the most scrupulous man in Spain; when I went in a few weeks back to buy a €20 pillow, he made me sign two contracts.

Until recently, I’d only spoken to José once. Yesterday, however, I decided to drop in to his ship to get his take on today’s general strike. And even though it was a month since I’d been in there last, and although the guy barely knows me, José greeted me by name and didn’t seem at all put out that I was only making a social call.

José told me that although business is ticking over he’s noticed a shift in the last 12 months. ‘Last year, people fitted out entire rooms. Now they just come in and buy individual items like a sofa or table.’ He also said that, in the last half year or so, not one of his customers had been granted a line of credit by his company’s head office.

‘And one of those people was a public servant too, on a fixed contract and with a good salary. If he can’t get credit, no one can.’

When I asked José was going to hacer huelga (go out on strike) today he shook his head. ‘If it was up to me, I would – out of solidarity with the people in this [working class] neighbourhood. But, then again, I know the demonstrations are all just a show really. The unions are as much a part of a problem as everyone else.’

José knows Spain’s dilemma is not new. He’s convinced everyone knew full well what was happening with the debt a long time ago. It’s just that no one wanted to own up to their failures. ‘Spain is like a man standing in a room that is slowly filling up with water. And now that it has reached his neck, he’s finally beginning to admit what’s going on.

‘But what we need now is solutions that make it easier to do business. We need to be more open in our outlook – more American – and stop being so traditional.’

So José isn’t striking today. You won’t spot him on TV and he won’t appear on the front page of your newspaper. He won’t be adding to the numbers surrounding some parliament building somewhere and he won’t be parading with his family in front of a cash-strapped hospital. Instead, he’s learning how to sell kitchens.

And it’s not that José is part of some dozing silent majority. Far from it. He’ll happily offer his opinion if you ask. It’s just that this guy is fighting the crisis one meticulously honest transaction at a time. Criticise him if you will, but the guy’s got my business.


Written by georgemills25

November 14, 2012 at 09:07