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Briefing: Catalonia's bid to breakaway from Spain

Austerity's bite revives a long-running independence push for Spain's Catalonia. How likely is its success?

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People walk past torn electoral posters calling for the independence of Catalonia following the elections in Barcelona, Spain, last month.

Emilio Morenatti/AP

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Q: Why independence?

Catalonian independence aspirations are centuries old and have throughout history resurfaced in times of institutional instability, not unlike the Basque Country's parallel struggle. After Spain regained its democracy after the death of dictator Francisco Franco in 1975, regional frictions were put off until the country regained its footing and stability.

Independence momentum went dormant with a two-decade economic boom and European Union membership. Long-contained frustration with the central government not surprisingly resurfaced with the economic crisis.

Catalonia's economy is the size of Portugal's, but like other Spanish regions it is over-indebted, and the central government has had to bail it out. Austerity cuts have been more severe than in most other regions. The majority of Catalonians feel they are paying disproportionately more to the central government than what they get in return.

But even if independence is a long-term goal, Catalonia wants to at least gain the upper hand in pending renegotiations of its fiscal pact with Madrid. The goal is to gain full control of its fiscal affairs, from tax collection to public expenditure.

Q: Why does Madrid want Catalonia to stay?

Yielding to Catalonia's pretensions would not only trigger a domino effect, it would also handicap the central government economically at this juncture by losing a big portion of its tax revenue. In effect, Catalonia's economic prowess subsidizes slow growth in the south.

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