Camps and Costa found not guilty of corruption by Gürtel jury

Former Valencia PP chiefs cleared of wrongdoing over receipt of tailored suits

MARÍA FABRA / IGNACIO ZAFRA – Valencia – 25/01/2012

The nine-member jury in the corruption case against former Popular Party PP regional premier of Valencia, Francisco Camps, and his co-defendant, ex-PP secretary general in Valencia, Ricardo Costa, returned a not guilty verdict by five-to-four late on Wednesday after three days of deliberation.

Camps and Costa were accused of receiving gifts from the Gürtel network, a ring of businessmen who bribed Popular Party officials in Valencia, Castilla-La Mancha and Madrid in return for public contracts worth millions of euros. Francisco Correa, the jailed alleged ringleader of Gürtel, gave evidence in the trial against Camps and Costa.The main piece of evidence in the case were tailored suits that anti-corruption prosecutors claimed had been gifted to Camps. The former regional premier always maintained that he had paid for the suits, despite there being no record of money changing hands.In delivering its verdict, the jury said it had reached the conclusion that neither Camps nor Costa received gifts in an official capacity because of their posts and that it was not proven that the suits were paid for by members of the Gürtel ring.The jury foreman said there was “no accreditation that Camps did not pay for the clothes.” The testimony of Isabel Jordán – who was heard on tape in the court saying she had seen a 30,000-euro bill for Camps suits in a Gürtel-related companys accounts – and of José Tomás, the tailor at the center of the case, did not sway all jurors.However, the Valencia PP has not yet shed Gürtel from its back. The Valencia High Court is still investigating a wide range of crimes, including illegal party financing, bribery and corruption, in which Camps former deputy, Vicente Rambla, Costa and several other PP members are implicated.The Gürtel case broke in 2009 when High Court Judge Baltasar Garzón blew the lid on the network and anti-corruption investigators implicated Camps. Garzón is currently being tried in the Supreme Court for the use of wiretaps to monitor conversations between jailed Gürtel suspects and their lawyers.

via Camps and Costa found not guilty of corruption by Gürtel jury · ELPAÍS.com in English.

Ex-Valencia premier makes last plea of innocence

Jury to get the “suit-gate” case on Monday.

M. F. / I. Z. – Valencia – 20/01/2012

Former Valencia regional premier Francisco Camps made a final plea of innocence Friday as jurors were set to begin deliberating next week over whether he and another ex-Popular Party PP official received dress suits and other gifts from members of the Gürtel corrupt businessmens network.

“I am innocent and I have come here looking for justice from my trusting and committed fellow citizens,” Camps said after closing arguments in the case.Camps went on trial in Valencia High Court on December 12 along with former local PP secretary general Ricardo Costa. Judge Juan Climent on Monday will come up with a jury verdict form with questions the nine jurors can answer.To be found guilty, seven must vote in favor; an acquittal will only need five votes. If there is no agreement among the panel, the judge will release the jury and order a new trial. Camps and Costa face fines of up to 41,000 euros if they are found guilty.

via Ex-Valencia premier makes last plea of innocence · ELPAÍS.com in English.

White elephants

In the past few days there has been so much in the press about Castellon Airport that it is difficult to keep track of it. It would appear that Castellon Airport has become the metaphor for waste in Spain.
Adolf Beltran in his article “Una manada de elefantes blancos” in El País claims that the airport without planes of Castellón triumphs in the world as a symbol of waste. He quotes the recent article in the Daily Telegraph “Spain’s white elephant airport 30 milion euros spent on advertising.”

There was the Giles Tremlett article “Spanish politicians 24-metre sculpture prompts accusations of megalomania” in the Guardian reproduced here last week.

And then this weekend in El País there was the rant of Antonio Muñoz Molina “La era de la fealdad” ( The era of ugliness) in which he makes reference to the airport.

“To remind that the sculpture will cost 300,000 euros is without doubt a meanness. Who puts a price on art. And after all that spending is a trifle at an airport that has cost 150 million euros, and will cost 8 million a year to maintain. In the not improbable case that no plane comes to land, the locals can indulge walking bucolically along the runway and admire in silence the sculpture of the artist Ripollés. Perhaps in a thousand years the 20-ton Castellón colossus will be one of the few visible relics of our era of ugliness.”

Moody’s Downgrades Spain’s Valencia Region Further Into Junk

MADRID (Dow Jones)–Moody’s Investors Service Inc. Thursday lowered its rating on Valencia further into junk territory and warned other Spanish regions of a possible downgrade, citing severe liquidity strains.

“As regions access to capital markets remains problematic, they are left with few funding options,” the ratings agency said.

Moody’s cut Valencia by two notches to Ba3 from Ba1.

In December, Valencia was a week late in repaying a EUR123 million debt to Deutsche Bank AG and failed to raise the full amount of a new EUR1.8 billion bond issue.

In highly decentralized Spain, regional governments control around a third of spending. But, faced with gaping budget gaps and towering debt loads, they have faced mounting difficulties to finance themselves.

-By Jonathan House, Dow Jones Newswires, +34 91 395 8121;

jonathan.house@dowjones.com

via Moody’s Downgrades Spain’s Valencia Region Further Into Junk – WSJ.com.

Spanish politicians 24-metre sculpture prompts accusations of megalomania

A copper monument dedicated to Carlos Fabra is being erected in front of a new airport at public expense.

Giles Tremlett in Madrid guardian.co.uk, Tuesday 10 January 2012 16.15 GMT

Many Spanish airports have been forced to close, raising questions about the new airports viability. It is the biggest white elephant in Spain – a €300,000, 24-metre-high statue dedicated to an infamous politician whose face will welcome people to a brand new airport that no one uses.The monument to Carlos Fabra, head of the newly built airport in the eastern province of Castellon and local boss of the governing Peoples party PP, is being erected in the middle of a roundabout at the airports entrance.Although still only half-built, the 20-tonne copper sculpture has provoked outrage in a Spain gripped by ferocious public spending cuts and massive unemployment.The local sculptor Juan Ripollés has said one of several faces on the monument will be that of Fabra, who recently retired after 16 years as president of the provincial assembly.”It is a homage to the origins of the airport project and to the person behind it, Carlos Fabra,” he explained. “It is made up of several faces, and will include the figure of Fabra.”The bill will be paid by the public company in charge of the airport, which happens to be run by Fabra himself.”This is proof of Fabras megalomania,” said the regional deputy Marian Albiolo of the opposition United Left party.With the newly built airport not yet in use, and questions already being raised over its viability after several airport closures in Spain, the money for the monument in effect comes out of taxpayers pockets.”This airport was finished 10 months ago, is not used and owes money,” said the socialist deputy Joaquim Puig.Fabra has been at the centre of corruption allegations with, among other things, court investigators wanting to know how he regularly appears to win Spains El Gordo Christmas lottery – whose winning tickets are sometimes bought up by people trying to launder money. He denies the allegations, which have yet to be brought to trial.Fabra belongs to the Valencia regional branch of PP, the party of the prime minister, Mariano Rajoy. PP is mired in numerous corruption scandals.The Valencia region also has one of the biggest budget deficits in Spain, with the regional PP government this week announcing new tax rises and spending cuts.Austerity measures are being put into place across Spain as the economy sinks into the second part of a double-dip recession and unemployment reaches 23%.

via Spanish politicians 24-metre sculpture prompts accusations of megalomania | World news | guardian.co.uk.

Ryanair claims Spanair receives illegal funding

Airline’s deputy CEO also calls Spanish carrier “inefficient, high-cost and polluting”

AGENCIES – Madrid – 10/01/2012

Low-cost Irish carrier Ryanair sought to justify the funding it has received from the Catalan government to fly out of the airports of Reus and Girona, but slammed subsidies afforded to its Barcelona-based rival Spanair as “illegal.”

At a news conference to announce 19 new flights out of Girona this summer, Deputy Chief Executive Michael Cawley said the Catalan government had habitually broken European rules on state aid in its funding of Spanair, which he described as “inefficient, high-cost, polluting and should be in receivership.”

Ryanair last year negotiated eight million euros in funding from Catalonia in order to continue flying out of Reus and Girona. Cawley said Ryanair “does not look for subsidies, but for low costs,” and “does not care” how it goes about securing them.

via Ryanair claims Spanair receives illegal funding · ELPAÍS.com in English.

How a plane-less airport spent 30 million euros on ads

Public firm continued publicity spend despite doubts over Castellón’s future; massive statue of former provincial chief goes ahead

LORENA ORTEGA – Castellón – 08/01/2012

Over 30 million euros have been spent advertising Castellón’s airport, which is not yet operational and faces an extremely uncertain future after the regional government rescinded its agreement with the contractor that was supposed to run it.

This expense, undertaken in 2003 when the construction project got underway, was repeatedly criticized by Sindicatura de Comptes – the Valencian Audit Office – which noted that all agreements were being signed “without accrediting the need for the expense nor determining the price of the contract,” and without analyzing the possible benefits for the airport itself, which is located in Castellón province, in the northern portion of the Valencian region.

The news comes shortly after the Valencian government had to be helped out by Madrid authorities to ensure it would not default on a maturing loan of 123 million euros owed to Deutsche Bank. The move underscored the liquidity problems of the most indebted of Spain’s 17 semi-autonomous regions, with a debt-to-GDP ratio of 19.9 percent.

To many people, the “airport without airplanes” has come to symbolize the wastefulness of Valencian officials in recent years, when the real-estate bubble fueled a series of oversize projects of questionable economic value.

Since then, there has been a steady trickle of cases of money squandering by Valencia’s public agencies, including Emarsa, a water treatment plant that was allegedly used by its managers to divert millions of euros to their own accounts. In this case, it was also a public company, Aeropuerto de Castellón SL (Aerocas), which made the decision to spend over 30 million euros in sponsorships, fairs and advertising events even though it was always unclear whether the airport would ever become profitable or even operational, given that the nearby provinces of Valencia and Alicante already have their own airports.

Despite the uncertainty, Aerocas sponsored sports teams such as first-division Villarreal CF, whose soccer players bore the logo of Castellón Airport on their shirts for three straight seasons in exchange for 2.35 million euros. The sponsorship was later extended to another soccer team, CD Castellón.

Aerocas admitted it cannot determine what the economic return on its investment will be, and instead talks about “an assumed risk.” Until now, managers held that the airport had to make itself known in order to attract tourists and secure agreements with the airlines. This last job was going to be carried out by the contractor with whom the regional government has just broken its deal.

Last week, the chief of Castellón province, Javier Moliner, announced that this year the airport would not be advertised at Fitur, a major tourism fair in Madrid, because “we need to promote what we have and not what we’re going to have.”

As a matter of fact, the future of Aerocas itself is up in the air after regional authorities said it would be merged into a holding to reduce public spending. Since its creation, Aerocas has doubled its personnel expense, which went up from 148,115 euros a year for three employees to the current 382,216 euros a year for a staff of seven.

In the meantime, Aerocas is continuing to build a 20-ton, 25-meter-high sculpture at the airport entrance at a cost of 300,000 euros. According to its creator, Juan García Ripollés, the inspiration for this statue is the man who masterminded the airport project in the first place: Carlos Fabra, the provincial premier of Castellón for the last 16 years who stepped down last June. Fabra, of the Popular Party (PP), is being investigated for tax fraud, influence peddling and bribery of public officials.

via How a plane-less airport spent 30 million euros on ads · ELPAÍS.com in English.

Government forced to step in to stop Valencia debt default

Regional economy chief plays down significance of Madrid’s involvement after loan deadline passes

LORENA ORTEGA / FEDERICO SIMÓN / EP – Castellón / Valencia – 04/01/2012

There is nothing extraordinary about the fact that the Spanish state had to help the government of Valencia meet its payments with foreign creditors, said the regional economy commissioner, Enrique Verdeguer, on Wednesday.

Calling it an isolated liquidity problem, Verdeguer claimed that the Generalitat is meeting all its financial deadlines, although he also admitted to meeting last week with the Spanish Treasury chief, Íñigo Fernández de Mesa. Shortly after that, Madrid decided to step in to ensure that the Valencian government would not default on a maturing debt of 123 million euros with Deutsche Bank.

This is the first time that the state has helped out a region – which in this case, happens to be the most indebted one out of Spain’s 17 semi-autonomous communities. Valencia’s debt-to-GDP ratio is 19.9 percent, and last September its deficit stood at 2.3 percent, a whole percentage point above what the state had authorized for the entire year.

Last year, the Valencian government owed providers 2.4 billion euros in unpaid bills, and pharmacies across the region recently went on a two-day strike to protest the situation. In the last few months, public workers have also been at risk of not getting their checks. But until now, banks had always been paid back promptly by a government that has already been dragged through the mud by the ratings agencies. In December, Standard & Poor’s placed Valencian debt one step away from junk bond status (BBB-).

Yet commissioner Verdeguer held that Valencia has simply done the same thing that other regional governments do through collaborations with the Official Credit Institute, the Treasury and private organizations. He also said that the Spanish Treasury did not underwrite the payment to Deutsche Bank, which was one week late. Other sources at the Valencian economy department said, on the contrary, that the Treasury had indeed guaranteed the payment, while the Economy Ministry denied it.

The key lies in the fact that the arbitrated solution does not constitute a formal guarantee, since the law prevents such a thing. Experts said that it is, in fact, a verbal endorsement – in other words, the Treasury interceded so that another lender would extend Valencia a short-term credit to pay back Deutsche Bank.

Yet even this move will not resolve Valencia’s long-term financial problems. The Spanish tax agency is also trying to help out by advancing the money it gives the regions from its tax receipts. Normally, this money is handed out twice a month, and the next installment was due in mid-January, but Valencia got its part on January 3 as an extraordinary measure.

Meanwhile, Valencian premier Alberto Fabra this week announced a further cut of one billion euros in regional spending that essentially cancels out the recently approved budget. The measures include eliminating 46 public agencies and leaving just six, and doing away with some of the benefits enjoyed by public servants. Regional authorities said these are exceptional measures that will only be in place for two years.

via Government forced to step in to stop Valencia debt default · ELPAÍS.com in English.