Why The Catalonia Independence Crisis Matters In Pekin

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A woman with a cage over her head and her face covered with a Catalan pro-independence flag takes part in a demonstration in Barcelona in November (JOSEP LAGO/AFP/Getty Images)

Communist Party leaders in Beijing won’t have been too unhappy to read news of Carles Puigdemont turning himself into Belgium authorities this week. The exiled leader of the Catalan independence movement, and former president of the near-autonomous region, fled after an unsuccessful bid to secede from Spain last month. The Spanish government, which has requested his extradition, intends to put him on trial for sedition. (He has been released on bail in Belgium).

China has been following developments closely, ever since an independence referendum was held in Catalonia last month. The jingoistic Global Times, a state-owned tabloid that often ventriloquizes Party leaders, was quick to lay blame on so-called Western values, as is the newspaper’s wont of late. “The West’s extravagant explanation over democracy, freedom and human rights over a long period of time is the fundamental reason this time, which provides the Catalan separatist movement a moral high ground it’s not supposed to have,” reads an editorialpublished late last month.

Such doggerel, however, was mere gilding over what really concerned Beijing, as the same editorial alluded to in one brief sentence: “A state is still an effective and basic unit for human society and in maintaining world order.” And the article’s conclusion, that the “Catalan independence movement sets off alarm bells for Europe,” was half-correct. The other half is that it also sets off sirens in Beijing, as Foreign Ministry spokeswoman Hua Chunying insinuated last month when she said that China “closely follows the relevant situation in Catalonia.”

National and ethnic unity

As early as October 12, days before Spain’s Constitutional Court ruled the independence referendum “void,” Hua said in a news briefing that her country “understands and supports the Spanish government’s efforts to protect national unity.” Weeks later, after Madrid said it would re-impose direct rule on the region, Hua commented: “We think this is an internal affair for Spain, and understand and support the Spanish government’s efforts to protect national and ethnic unity and territorial integrity.”

Anything that reeks of separatism, even on another continent, tends finds a bad taste among China’s Communist leadersand for good reason: the euphonized Tibet Autonomous Region and the equally disingenuous Xinjiang Uyghur Autonomous Region have been restive for decades, the latter increasingly so. Indeed, during President Xi Jinping’s opening speech at the Chinese Communist Party congress, held last month, he said China will “resolutely safeguard [its] national sovereignty and territorial integrity, and will absolutely not tolerate the tragedy of the country’s split.”

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Aside from its own domestic secessionist concerns, what motivates China is the EU’s stability. President Xi said in July he wants to see a “united, stable, prosperous and open” European Union. This might not be as true for solidarity over issues like anti-dumping and protectionism, though. French President Emmanuel Macron’s wants to form an “alliance” among European nations in order to formally oppose Chinese acquisitions of the continent’s strategic industries. But he found division at a European Council summit in June when some nations, reportedly those in Scandinavia and Eastern Europe, rejected his motion to “screen investments from third countries in strategic sectors.”

Still, Beijing certainly doesn’t want to see the EU broken up by secessionist talk. It took a firm stance against Brexit, as it did against Scottish independence. Partly, this has to do with geopolitics. The EU has moved closer to China since the inauguration of Donald Trump, and Xi has found a reliable partner in Angela Merkel, the de-facto head of the EU, who won another four years as German Chancellor in September. More still, China’s desire to become a major global power, an ambition enshrined at last month’s Party congress, means that multilateral stability is integral. The fracturing, even weakening, of the EU would only cause more headaches in Beijing, given that the EU, as a whole, is China’s largest trading partner.

Chinese investments

Economics also matter in China’s approach to Catalan independence. In 2016, Chinese investments in Spain were worth almost $2 billion, a fourfold increase from the previous year. This now makes Spain the seventh largest European recipient of Chinese investment. Moreover, increasing numbers of Chinese tourists, as well as entrepreneurs and retirees, are flocking to Spain. There were about 100,000 Chinese with a residency permit living in Spain a decade ago. By 2016’s figure, the number is now at 203,000. This was helped by Spain’s introduction of a “golden visa” scheme in 2014, which offers residency to those who spend more than €500,000 on property in the country.

The largest Chinese investment in Spain in recent years was the €1.17 billion acquisition of Urbaser, an environmental unit of the engineering firm ACS Group, reported major Spanish daily El Pais. The second-largest was toy-car giant Chen Yansheng’s purchase of RCD Espanyol, a Barcelona-based soccer team. Interestingly, investment in Spain tends to be centered around its economic hotspots, of which Catalonia is by far the most important. An estimated 40% all Chinese investments in Spain goes into the Catalan region, based on the number of Chinese firms in the country. Catalonia accounted for about a quarter of Spain’s exports last year, and which attracted roughly 15 % of Spain’s foreign investment in the previous year, only beaten by the capital, Madrid. Catalonia, also, boasts three of Spain’s top universities, attracts more tourists than any other region and is the heart of the country’s new industries, like bio-sciences.

Such economic weight, however, would have been jeopardized by independence. Given the EU’s hostile response to the independence referendum, it is almost certain that an independent Catalonia would never have been allowed to join the EU or enter the single market. A possible Catalonia-EU free trade agreement would have taken years of negotiation, if on the table at all. Moreover, corporations based in Catalonia were making preparations to move offices away from the region in the event independence was granted; some have already done some. No doubt, this would have impacted upon the Chinese firms invested in the Catalan region. Tariff-free trade with the EU nations would likely have been taken away, while many Chinese firms might have had to up sticks to other Spanish regions or elsewhere in Europe, at a considerable cost. Small wonder Beijing sided with Madrid. Stop the talk of succession, first, and continue making profits, second. Everything, it seems, has gone to plan.

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