Tourist Information Guide

Political and Economic System in Spain

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This page has a summary of the political and economic systems in Spain.

Government

Type: Constitutional monarchy (Juan Carlos I proclaimed King November 22, 1975).
Constitution: 1978.
Branches: Executive-president of government nominated by monarch, subject to approval by democratically elected Congress of Deputies. Legislative-bicameral Cortes: a 350-seat Congress of Deputies (elected by the d'Hondt system of proportional representation) and a Senate. Four senators are elected in each of 47 peninsular provinces, 16 are elected from the three island provinces, and Ceuta and Melilla elect two each; this accounts for 208 senators. The parliaments of the 17 autonomous regions also elect one senator as well as one additional senator for every 1 million inhabitants within their territory (about 20 senators). Judicial-Constitutional Tribunal has jurisdiction over constitutional issues. Supreme Tribunal heads system comprising territorial, provincial, regional, and municipal courts.
Subdivisions: 47 peninsular and three island provinces; two enclaves on the Mediterranean coast of Morocco (Ceuta and Melilla) and three island groups along that coast-Alhucemas, Penon de Velez de la Gomera, and the Chafarinas Islands.

Political parties: Spanish Socialist Workers Party (PSOE), Popular Party (PP), and the United Left (IU) coalition. Key regional parties are the Convergence and Union (CIU) in Catalonia and the Basque Nationalist Party (PNV) in the Basque country.


Economy

GDP (2004): $955.1 billion in current prices (seventh-largest Organization for Economic Cooperation and Development-OECD-economy).
Annual growth rate: 2.5%.
Per capita GDP: $22,421.
Natural resources: Coal, lignite, iron ore, uranium, mercury, pyrites, fluorspar, gypsum, zinc, lead, tungsten, copper, kaolin, hydroelectric power.
Agriculture and fisheries (2.9% of GDP, 2004 est.): Products-grains, vegetables, citrus and deciduous fruits, wine, olives and olive oil, sunflowers, livestock.
Industry (17.3% of GDP, 2004 est.): Types-processed foods, textiles, footwear, petrochemicals, steel, automobiles, consumer goods, electronics.
Trade (2003): Exports-$137.8 billion: automobiles, fruits, minerals, metals, clothing, footwear, textiles. Major markets-EU 71.8%, U.S. 4.12%. Imports-$184.1 billion: petroleum, oilseeds, aircraft, grains, chemicals, machinery, transportation equipment, fish, consumer goods. Major sources-EU 63.9%, U.S. 3.7%.
Average exchange rate (first semester 2004): €0.815=U.S.$1.


People

Spain's population density, lower than that of most European countries, is roughly equivalent to New England's. In recent years, following a longstanding pattern in the rest of Europe, rural populations are moving to cities.
Spain has no official religion. The constitution of 1978 disestablished the Roman Catholic Church as the official state religion, while recognizing the role it plays in Spanish society. More than 90% of the population are at least nominally Catholic.


Educational System

About 70% of Spain's student population attends public schools or universities. The remainder attend private schools or universities, the great majority of which are operated by the Catholic Church. Compulsory education begins with primary school or general basic education for ages 6-14. It is free in public schools and in many private schools, most of which receive government subsidies. Following graduation, students attend either a secondary school offering a general high school diploma or a school of professional education (corresponding to grades 9-12 in the United States) offering a vocational training program. The Spanish university system offers degree and post-graduate programs in all fields-law, sciences, humanities, and medicine-and the superior technical schools offer programs in engineering and architecture.


Maps of Spain

Maps GPS Info.com - Useful information about maps and GPS including resources for those planning travel to Spain.


History

Spain's Iberian Peninsula has been settled for millennia. In fact, some of Europe's most impressive Palaeolithic cultural sights are located in Spain, including the famous caves at Altamira that contain spectacular paintings dating from about 15,000 to 25,000 years ago. The Basques, Europe's oldest surviving group, are also the first identifiable people of the peninsula.
Beginning in the ninth century BC, Phoenicians, Greeks, Carthaginians, and Celts entered the Iberian Peninsula. The Romans followed in the second century BC and laid the groundwork for Spain's present language, religion, and laws. Although the Visigoths arrived in the fifth century AD, the last Roman strongholds along the southern coast did not fall until the seventh century AD. In 711, North African Moors sailed across the straits, swept into Andalusia, and within a few years, pushed the Visigoths up the peninsula to the Cantabrian Mountains. The Reconquest-efforts to drive out the Moors-lasted until 1492. By 1512, the unification of present-day Spain was complete.

During the 16th century, Spain became the most powerful nation in Europe, due to the immense wealth derived from its presence in the Americas. But a series of long, costly wars and revolts, capped by the defeat by the English of the "Invincible Armada" in 1588, began a steady decline of Spanish power in Europe. Controversy over succession to the throne consumed the country during the 18th century, leading to an occupation by France during the Napoleonic era in the early 1800s, and led to a series of armed conflicts throughout much of the 19th century.

The 19th century saw the revolt and independence of most of Spain's colonies in the Western Hemisphere: three wars over the succession issue; the brief ousting of the monarchy and establishment of the First Republic (1873-74); and, finally, the Spanish-American War (1898), in which Spain lost Cuba, Puerto Rico, and the Philippines to the United States. A period of dictatorial rule (1923-31) ended with the establishment of the Second Republic. It was dominated by increasing political polarization, culminating in the leftist Popular Front electoral victory in 1936. Pressures from all sides, coupled with growing and unchecked violence, led to the outbreak of the

Spanish Civil War in July 1936.
Following the victory of his nationalist forces in 1939, General Francisco Franco ruled a nation exhausted politically and economically. Spain was officially neutral during World War II but followed a pro-Axis policy. Therefore, the victorious Allies isolated Spain at the beginning of the post-war period, and the country did not join the United Nations until 1955. In 1959, under an International Monetary Fund stabilization plan, the country began liberalizing trade and capital flows, particularly foreign direct investment.
Despite the success of economic liberalization, Spain remained the most closed economy in Western Europe-judged by the small measure of foreign trade to economic activity-and the pace of reform slackened during the 1960s as the state remained committed to "guiding" the economy. Nevertheless, in the 1960s and 1970s, Spain was transformed into a modern industrial economy with a thriving tourism sector. Its economic expansion led to improved income distribution and helped develop a large middle class. Social changes brought about by economic prosperity and the inflow of new ideas helped set the stage for Spain's transition to democracy during the latter half of the 1970s.

Upon the death of General Franco in November 1975, Franco's personally designated heir Prince Juan Carlos de Borbon y Borbon assumed the titles of king and chief of state. Dissatisfied with the slow pace of post-Franco liberalization, he replaced Franco's last Prime Minister with Adolfo Suarez in July 1976. Suarez entered office promising that elections would be held within one year, and his government moved to enact a series of laws to liberalize the new regime. Spain's first elections since 1936 to the Cortes (Parliament) were held on June 15, 1977. Prime Minister Suarez's Union of the Democratic Centre (UCD), a moderate centre-right coalition, won 34% of the vote and the largest bloc of seats in the Cortes.

Under Suarez, the new Cortes set about drafting a democratic constitution that was overwhelmingly approved by voters in a national referendum in December 1978.


Government And Political Conditions

Parliamentary democracy was restored following the death of General Franco in 1975, who had ruled since the end of the civil war in 1939. The 1978 constitution established Spain as a parliamentary monarchy, with the prime minister responsible to the bicameral Cortes (Congress of Deputies and Senate) elected every 4 years. On February 23, 1981, rebel elements among the security forces seized the Cortes and tried to impose a military-backed government. However, the great majority of the military forces remained loyal to King Juan Carlos, who used his personal authority to put down the bloodless coup attempt.

In October 1982, the Spanish Socialist Workers Party (PSOE), led by Felipe Gonzalez, swept both the Congress of Deputies and Senate, winning an absolute majority. Gonzalez and the PSOE ruled for the next 13 years. During that period, Spain joined the North Atlantic Treaty Organization (NATO) and the European Community.

In March 1996, Jose Maria Aznar's Popular Party (PP) won a plurality of votes. Aznar moved to decentralize powers to the regions and liberalize the economy, with a program of privatisation, labour market reform, and measures designed to increase competition in selected markets. During Aznar's first term, Spain fully integrated into European institutions, qualifying for the European Monetary Union. During this period, Spain participated, along with the United States and other NATO allies, in military operations in the former Yugoslavia. President Aznar and the PP won re-election in March 2000, obtaining absolute majorities in both houses of parliament.

After the terrorist attacks on the U.S. on September 11, 2001, President Aznar became a key ally in the fight against terrorism. Spain backed the military action against the Taliban in Afghanistan and took a leadership role within the European Union (EU) in pushing for increased international cooperation on terrorism. The Aznar government, with a rotating seat on the UN Security Council, supported the intervention in Iraq.

Spanish parliamentary elections on March 14, 2004 came only three days after a devastating terrorist attack on Madrid commuter rail lines that killed 191 and wounded over 1,400. With large voter turnout, PSOE won the election and its leader, Jose Luis Rodriguez Zapatero, took office on April 17, 2004. The Zapatero government has supported coalition efforts in Afghanistan, including maintaining troop support for 2004 elections, supported reconstruction efforts in Haiti, and cooperated on counter terrorism issues. Carrying out campaign promises, it immediately withdrew Spanish forces from Iraq but has continued to support Iraq reconstruction efforts.


Local Government

The 1978 constitution authorized the creation of regional autonomous governments. By 1985, 17 regions covering all of peninsular Spain, the Canaries, and the Balearic Islands had negotiated autonomy statutes with the central government. In 1979, the first autonomous elections were held in the Basque and Catalan regions, which have the strongest regional traditions by virtue of their history and separate languages. Since then, autonomous governments have been created in the remainder of the 17 regions. The central government continues to devolve powers to the regional governments, which will eventually have full responsibility for health care and education, as well as other social programs.


Economy

Spain's accession to the European Community-now European Union (EU)-in January 1986 required the country to open its economy, modernize its industrial base, improve infrastructure, and revise economic legislation to conform to EU guidelines. In doing so, Spain increased gross domestic product (GDP) growth, reduced the public debt to GDP ratio, reduced unemployment from 23% to 15% in 3 years, and reduced inflation to under 3%. The fundamental challenges remaining for Spain include reducing the public sector deficit, decreasing unemployment further, reforming labour laws and investment regulations, lowering inflation, and raising per capita GDP.
Following peak growth years in the late 1980s, the Spanish economy entered into recession in mid-1992. The economy recovered during the first Aznar administration (1996-2000), driven by a return of consumer confidence and increased private consumption, although growth has slowed in recent years. Unemployment remains a problem at 10.5% (2004 est.), but this still represents a significant improvement from previous levels. Devaluations of the peseta during the 1990s made Spanish exports more competitive, but the strength of the euro since its adoption has raised recent concerns that Spanish exports are being priced out of the range of foreign buyers. However, this has been offset by the facilitation of trade among the euro nations.


Foreign Relations

After the return of democracy following the death of General Franco in 1975, Spain's foreign policy priorities were to break out of the diplomatic isolation of the Franco years and expand diplomatic relations, enter the European Community, and define security relations with the West.
As a member of NATO since 1982, Spain has established itself as a major participant in multilateral international security activities. Spain's EU membership represents an important part of its foreign policy. Even on many international issues beyond Western Europe, Spain prefers to coordinate its efforts with its EU partners through the European political cooperation mechanism.

With the normalization of diplomatic relations with Israel and Albania in 1986, Spain virtually completed the process of universalising its diplomatic relations. The only country with which it now does not have diplomatic relations is North Korea.

Spain has maintained its special identification with Latin America. Its policy emphasizes the concept of Hispanidad, a mixture of linguistic, religious, ethnic, cultural, and historical ties binding Spanish-speaking America to Spain. Spain has been an effective example of transition from authoritarianism to democracy, as shown in the many trips that Spain's King and Prime Ministers have made to the region. Spain maintains economic and technical cooperation programs and cultural exchanges with Latin America, both bilaterally and within the EU.

Spain also continues to focus attention on North Africa, especially on Morocco. This concern is dictated by geographic proximity and long historical contacts, as well as by the two Spanish enclave cities of Ceuta and Melilla on the northern coast of Africa. While Spain's departure from its former colony of Western Sahara ended direct Spanish participation in Morocco, it maintains an interest in the peaceful resolution of the conflict brought about there by decolonisation. These issues were highlighted by a crisis in 2002, when Spanish forces evicted a small contingent of Moroccans from a tiny islet off Morocco's coast following that nation's attempt to assert sovereignty over the island.

Meanwhile, Spain has gradually begun to broaden its contacts with Sub-Saharan Africa. It has a particular interest in its former colony of Equatorial Guinea, where it maintains a large aid program.
In relations with the Arab world, Spain has sought to promote European-Mediterranean dialogue. Spain strongly supports the EU's "Barcelona Process" which seeks to expand dialogue and trade between Europe and the nations of North Africa and the Middle East, including Israel.

Spain has been successful in managing its relations with its two European neighbours, France and Portugal. The accession of Spain and Portugal to the EU has helped ease some of their periodic trade frictions by putting these into an EU context. Franco-Spanish bilateral cooperation is enhanced by joint action against Basque ETA terrorism. Ties with the United Kingdom are generally good, although the question of Gibraltar remains a sensitive issue.


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