Catalonia has received 56% of Spain’s foreign research spending since 2010

“Everyone invests in Catalonia, except for the Spanish government”, said the Catalan minister for Business and Employment, Felip Puig, during last Friday’s presentation of some data on business investment in innovation. Halfway through the Spanish election campaign, the Catalan authorities have chosen to openly counter the trail of reports about an alleged “business drain” in Catalonia caused by the independence bid. The Catalan ministry’s conclusions are clear: Catalonia is the leading Spanish region in business innovation. It is also one of the European regions that has drawn the most foreign investment in Research and Development in the last few years and has already reversed the downward investment trend in innovation of Catalan firms.

The Catalan government’s arguments come from three different sources. First of all, from the Financial Times’ Foreign Direct Investments observatory (FDI), which the ministry for Business and Employment has used to rank the top 20 countries that invest in Catalonia in R&D and the number of projects that have received the capital invested. According to this ranking, it is countries such as Germany, the US and the UK that spend the most on business innovation in Catalonia and the rest of Spain, but Catalonia has been keeping up to 56 per cent of the overall spending since 2010. This percentage has meant a total number of 66 projects and €1.07bn, which helped to create six thousand jobs.

The FT figures are not made public, but the Catalan government processed and divulged them as a ranking and, according to Esade professor Xavier Mendoza (director of Spain’s Multinational Business Observatory), they are consistent with his institution’s and reflect an undeniable situation: “Catalonia has a number of shortcomings when it comes to innovation, but it is progressing steadily”. Professor Mendoza claims that Catalonia is able to attract foreign investors for the following reasons: it has a diversified business structure, leading multinational companies have Catalan subsidiaries (Seat and Nissan in the automotive sector; Henkel in the chemical sector and Nestlé in the food industry); it has good transport and logistical infrastructures, thanks to the port of Barcelona; and it stands out in the software and computer industries.

Catalonia leads in number of innovative companies, with 22 per cent of all of Spain’s

Another figure which the Catalan authorities highlighted is that 22.1 per cent of all innovative companies in Spain are Catalan. The minister stated that “Catalonia is becoming one of the European regions that attract the most technological innovations”, and he insisted that the figures “are not cooked in Catalonia” but come from foreign sources and “even from Spain itself”. In fact, the percentage comes from data released on Thursday by Spain’s Instituto Nacional de Estadística (INE), according to which 8,830 innovative companies were located in Catalonia between 2010 and 2014, which is 21,1 per cent of the total number of such businesses in Spain.

The INE classes as “innovative firms” all companies whose scientific, technological, organisational or financial activities result in an innovative change within their productive structure. They can be sorted into two groups according to whether their innovation is of a technological nature or not, with Catalonia still in the lead, always followed by Madrid, with 7,188 innovative firms, 18 per cent of the total number. On this point, Felip Puig mentioned on Thursday that this figure represents a 7.6 per cent increase from 2013, whereas in the whole of Spain the number rose by 3.9 per cent.

Yet another key aspect to diagnose the health of business innovation in Catalonia is the cash which such activities involve. In October Eurostat, the European statistics agency, ranked Catalonia at the very bottom of regional spending on R&D versus GDP, with only 1,51 per cent of the overall expenditure and trailing well behind Belgium’s Brabant Valí region, with a 7.1 per cent effort.

Nevertheless, the latest INE figures confirm that business investment in innovation is making a comeback in Catalonia. While a negative trend still prevails in Spain as a whole and Spanish companies spent 2.1 per cent less, in Catalonia there was a 0.8 per cent increase, which Puig called modest but he claimed that it signals the end of the drop in innovation spending. Spain’s overall expenditure was nearly €13m, of which €3.1m was spent by Catalan firms. This amounts to 24 per cent of the overall figure, which means that Catalan companies rank second in Spain in terms of expenditure on innovation, following Madrid, which received 36 per cent of the investments, up 6.3 per cent from 2013.