Spain’s Industry: Challenges and Evolution
Spain’s Industry: Challenges and Evolution in a Globalized Economy
The Cohesion Fund, established after the signing of the Maastricht Treaty in February 1992, aimed to reduce economic disparities between EU Member States, potentially targeting industrial projects. However, the inclusion of new countries in the EU has negatively impacted Spanish industry. The causes include:
- These new countries are closer to the European industrial axis formed by Nordic countries, Germany, and northern Italy.
- Labor costs are lower in these countries.
- Productivity and specialization in high-tech areas are higher.
One of the sectors most affected is the automotive industry, driven by large foreign companies that could delocalize Spanish production to reduce costs.
The Changing Landscape of Spanish Industry
Spanish industry has transformed from a landscape of isolated nuclei with little connection to an interconnected industrial landscape with defined axes. Currently, the territorial model is based on industrial centers that tend to grow alongside established industrial areas. These metropolitan areas guarantee good communication infrastructure, energy, wastewater treatment, and attract ancillary and complementary services. The three main industrial centers in Spain are Catalonia, the Basque Country, and Madrid.
Catalan industry maintains the first place among all autonomous communities in both turnover and the number of employed persons. In addition to areas with a strong industrial tradition, two major lines created in the 1970s are still expanding:
- The Mediterranean Core: Linking industrial activities in Catalonia and Valencia, connecting with the European Mediterranean axis leading to northern Italy and Central Europe.
- The Ebro Core: Connecting the Basque area with Catalonia through Zaragoza and Logroño, extending to Madrid.
Other minor areas exist, but the industrial distribution shows significant territorial imbalances, with the rest of Spain having a much lower industrial density and fewer sectors.
Challenges to Competitiveness
Spanish industry faces several challenges to competitiveness in an increasingly globalized world economy, including:
- The predominance of SMEs, which limits large investments in high technology.
- Low productivity of Spanish industrial companies.
- Inadequate investment in R&D, forcing many Spanish industries to buy patents.
Globalization and Delocalization
Spanish industry is now integrated into a global production network characterized by the concentration of capital in a few multinational companies. These companies seek to increase competitiveness, reduce labor costs, and lower tax burdens. Consequently, many companies are delocalizing to Eastern Europe, Southeast Asia, and China. The implications include:
- Increased unemployment.
- A shift towards the tertiary sector, focusing on providing services rather than production.
The Evolution of Catalan Industry
Both Catalan and Spanish industries are changing their production models. To maintain competitiveness, Catalan industry has opted for automation and computerization, leading to a reduction in manpower, especially unskilled labor. It has also delocalized part of its production operations but has retained the most qualified and valuable processes.