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ECONOMY

How war in Israel could affect Spain

The outbreak of war in Israel and the Gaza Strip could have several significant consequences for life in Spain, from fuel prices to travel, the economy and reinforced security.

Published: 9 October 2023 17:20 CEST
How war in Israel could affect Spain
Palestinians search for survivors after an Israeli airstrike on buildings in the refugee camp of Jabalia in the Gaza Strip on October 9, 2023. Photo: Mahmud HAMS/AFP.

There is another major geopolitical war raging in the world after Palestinian militant group Hamas on Saturday October 7th launched a barrage of rockets to Israel and sent a wave of fighters who gunned down Israeli civilians and took at least 100 hostages.

More than 700 Israelis have been killed and another 1,200 people have been wounded, many critically.

The Israeli army has since retaliated and on Monday said it hit more than 500 targets in the blockaded and impoverished Gaza Strip in overnight clashes, while fighting persisted in seven to eight locations inside Israel around the enclave. The Palestinian death toll is now nearing 500, according to the Gaza-based Health Ministry.

With talk of the ‘worst attack in Israeli history’ and ‘mighty vengeance’ on the Jewish part, there is no telling how long this deadly conflict between Hamas and Israel could last, but it’s already risking having an impact on world affairs, including in Spain.

Protection of Jewish people and sites in Spain

Like in other countries such as the US and France, in the days after the outbreak of conflict Spanish Security Forces have adopted the “necessary measures” to protect Jewish interests in Spain, according to police sources. The measures are reportedly similar to in other western nations, bolstering protections for Jewish people and cultural and religious sites in case anyone attacks in response to or coinciding with what happens in Israel and the Gaza Strip.

The Spanish government opened up fast-track routes to citizenship for Sephardic Jews back in 2015. So far, 65,809 people have acquired Spanish nationality, according to the latest September 2022 data from the Ministry of Justice.

Commercial ties

War would also likely have a significant impact on Spain’s international trade and commercial ties with Israel, an exchange valued at commercial exchange of €3.15 billion a year. Statistics from Spain’s Ministry of Foreign Affairs and the state agency ICEX (Spain Export and Investments) reveal that in 2022 exports to Israel reached a record figure of €2.17 billion, which represents an increase of 20.2 percent compared to the previous year.

As for bilateral trading in services, ICEX figures reveal that in 2021 there was an exchange of €325 million in exports and €343 million in imports.

READ ALSO: Spain closes probe into hacking of PM’s phone over Israel’s ‘lack of cooperation

Inflation and fuel prices

In recent months in Spain rising fuel prices have put upward pressure on inflation.

If the price of oil is already causing spikes in inflation, the outbreak of full-scale war in Gaza and Israel will likely further destabilise the energy market. Spain’s General Council of Economists (CGE) has already warned this could be the case: “War influences the cost of oil, any focus of instability causes future markets to jump and a greater supply of raw material by intermediaries to occur, which causes the price of oil to rise,” Antonio Pedraza, president of the CGE’s Financial Commission, said in a statement.

“The logical thing is that it rises now and stabilises in the future,” Pedraza added.

READ ALSO: Energy prices drive up inflation in Spain in September

Political divisions

Domestic political conflict with regards to Israel-Palestine is not unique to Spain but could play a role in forming broader political divisions as the country continues with a caretaker government. Long a mainstay of domestic politics in the UK and USA, division over Gaza has also already emerged in Spain in the days following the latest flareup of violence in the Middle East.

Debate in Spain has followed the usual political fault lines seen abroad, with the far-left calling for the end of the ‘occupation’ of Gaza by Israel. Far-left group Sumar on Monday also criticised the ‘hypocrisy’ of the EU, as have smaller left-wing parties.

Sumar are currently aligned with the ruling Socialists (PSOE) and in negotiations to form a government. PSOE and acting Prime Minister Pedro Sánchez generally take a more mainstream, pro-EU, pro-NATO line on foreign policy, so splits between the two could prove tricky during negotiations and also give extra ammunition to the Spanish right when it accuses Sánchez of relying on the support of radicals.

Cancelled flights

Around the world several airlines have begun to cancel flights to Tel Aviv due to the ongoing clashes between Hamas and the Israel Defense Forces (IDF).

On Monday October 9th there were a total of 10 flights scheduled at Madrid-Barajas airport (5 arrivals and 5 departures) and 11 at El Prat Barcelona airport (5 arrivals and 6 departures) to Tel Aviv, according to Aena sources. As of 9.00am, there had already been four cancellations from Barcelona (2 departures and 2 arrivals).

If the conflict continues, flight paths could be disrupted for some time.

If the conflict worsens, expect more flights to and from Israel to be disrupted.

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POLITICS

Spain meets with UK govt to explore easing red tape on food trade

Spain’s agricultural Minister Luis Planas met with his British counterpart this week to try and ease post-Brexit red tape and request prior warning of any changes to border rules with Spain’s biggest non-EU food market.

Published: 11 September 2024 09:40 CEST
Spain meets with UK govt to explore easing red tape on food trade

Spain’s Minister for Agriculture, Fisheries and Food, Luis Planas, this week met in London with his British counterpart, Steve Reed, with the aim of strengthening trade in agricultural goods and a view to the possible elimination of post-Brexit bureaucratic red tape.

This comes amid a wider political recalibration from the new Labour government, with Prime Minister Keir Starmer signalling his intention to reset relations with the EU where possible.

Agricultural goods, in particular border check rules, are an issue that has effectively been botched since the former Conservative government’s 2020 Brexit deal. 

READ ALSO: What Labour’s UK election win means for Brits in Spain

The Spanish government, for its part, hopes this will help to increase its volume of food exports to the UK.

The UK is Spain’s fifth biggest destination for exports globally, and the first for exports outside the EU Internal Market. British imports of Spanish products in 2023 amounted to €4.82 billion, of which €2.1 billion were fruit and vegetables, followed by wine, citrus fruits, red fruits and olive oil.

A statement on Planas’ visit from La Moncloa asserted that “Spain plays a strategic role for the UK’s food security, as it is the UK’s main supplier of fresh produce.” Figures show that around a quarter of the vegetables imported by the UK come from Spain, and in the case of products such as lettuce, this figure rises to 80 percent.

Planas praised the “excellent collaboration” between Spain and the UK, something that has allowed the UK to remain one of the main markets for Spanish agri-food products after Brexit, despite the red tape and legal uncertainty, and stressed that this coordination will be further strengthened by the new Labour government.

Leaving the EU meant that Britain should have come up with new border rules on agri-food imports. However, red tape and bureaucratic backlogs have caused incidents on the border at times, something that can generate tensions between operators and damage trade relations.

The Conservative governments that oversaw Brexit negotiations with Brussels delayed implementing sanitary and phytosanitary border controls several times, something they were obliged to do by the trade agreement finally signed at the end of 2020. 

This was due largely to the fact that the British government was not prepared for new customs rules and border inspections, but also to avoid price increases for British consumers. Last week the British press revealed that the new Labour government also plans to delay new customs controls on fresh fruit and vegetables until July 2025.

Speaking to Spanish news agency EFE, Planas stressed the importance of reaching an agreement on standards. The meeting also discussed the proposed implementation of the ‘Border Target Operating Model’, a new customs model using technology that will establish different categories of controls and ease border fluidity.

Planas highlighted the importance of both operators and governments being as clear as possible about these changes and their implementation time. As such, the Minister requested from the UK government “a courtesy warning” before any changes are made to controls on imports.

“My warning, in this case, is simply a demand for courtesy. If you are going to do something, let us know in good time,” the Minister told Spanish daily El País.

Planas meeting in London comes amid broader moves by the Labour government to try and reboot relations with Brussels. Writing exclusively for The Local, Foreign Secretary David Lammy declared recently that “it’s time to reset Britain’s relations with Europe.”

In recent months, Spain’s Prime Minister Pedro Sánchez suggested to Starmer the idea of a reciprocal youth mobility scheme between the two countries, something Downing St. has distanced itself from.

READ ALSO: Can Spain and the UK legally create a ‘free movement scheme’ for young people?

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