Sunday 19 November 2017

Catalans face ejection from EU, warns banker

Political crisis: Spain’s prime minister Mariano Rajoy
Political crisis: Spain’s prime minister Mariano Rajoy

Mehreen Khan

Spain's Catalan region will be automatically ejected from the eurozone and its banking system will collapse, if voters choose to back independence for the region this weekend, the country's central bank governor has warned.

Luis Maria Linde, head of the Bank of Spain, said the region would not be able keep the single currency and its position in the European Union as a whole would be under threat should it decide to break away from Spain.

"The exit from the euro is automatic, the exit from the EU is implied," he said.

Catalan banks would also "stop having access to the European Central Bank's facilities", cutting off the last link between the financial system and the eurozone.

Latest polls show the region's separatist movement, led by president Artus Mas, is on course for a narrow win in local elections at the weekend.

A majority in the Catalan parliament would set the separatists on course to launch a full referendum on independence. Nationalist leaders have promised to declare independence within 18 months if they win.

Madrid, however, has vowed to block any accession application from the Catalans.

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