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Foreign Direct Investment:: Country Risk Assessmen

Table of Contents


A.Introduction     3
B.Political Indicators  4-11

C.Economic Indicators 12-18

D.Social Indicators 19-23

E. Overall County Total    24

F.Works Cited    25

A. Introcution

Spain’s powerful world empire of the 16th and 17th centuries ultimately yielded command of the seas to England. Subsequent failure to embrace the mercantile and industrial revolutions caused the country to fall behind Britain, France, and Germany in economic and political power. Spain remained neutral in World Wars I and II, but suffered through a devastating Civil War (1936-39). In the second half of the 20th century, it has played a catch-up role in the western international community. Continuing concerns are large-scale unemployment and the Basque separatist movement.
Spain’s population density, lower than that of most European countries, is roughly equivalent to New England’s population density. In recent years, following a longstanding pattern in the rest of Europe, rural populations are moving to cities. Spain has no official religion. The constitution of 1978 disestablished the Roman Catholic Church as the official state religion, but still recognizing the role, it plays in Spanish society. More than 90% of the population is at least nominally Catholic.
Through out the risk assessment, ratings are given before the risk indicator summary.  These rating are given for current status and a status five years from now.  Please keep in mind that the scale is measured from 1  7, 1 being the best and 7 being the worst.

B. Political Indicators
1.Political StabilityCurrent Rating:2
Forecast 5 Years:3
Right now under the Jose Maria Aznar Lopezs administration free market enterprises are being advocated to boost the economy.  The government intends to make further progress in changing labor laws and reforming pension schemes, which are key to the sustainability of both Spain’s internal economic advances and its competitiveness in a single currency area. Adjusting to the monetary and other economic policies of an integrated Europe – and further reducing unemployment – will pose challenges to Spain in the next few years.
Political tension in the Basque Country has eased tangibly since the mainstream Basque Nationalist Party (PNV) achieved its greatest ever victory in the regional election on May 13th. The mainstream political parties have acknowledged the PNV’s unequivocal victory and have signalled a more conciliatory approach to addressing the region’s problems, raising hopes of a gradual return to political “normality” over the next few years.
In the coming years many stabilty issues may or may not be worked out.  The biggest might be the Basque question.  Jose Maria Anzar is not really going after that like a real leader should but excels in other areas.  Their rating will decrease some in the comping years when a new president is elected.

2.Public Policy Imapcting Foreign Direct InvestmentCurrent Rating: 3
Forecast 5 Years:3
Policies and regulations regarding domestinc and foreign businesses have a major impact.  Recently Spain has been moving to open up so competition can thrive and help markets grow.  Prime Minister Jose Maria Aznar set the stage by trimming the role of the state, embracing free markets, and privatizing state companies over the past four years.  His all-out effort to slash Spain’s soaring budget deficit and join the single European currency has paid rich dividends in access to capital markets. With Spain in the euro zone, the country’s corporate chiefs can tap the bourses of an entire continent to finance their big foreign acquisitions.  That was impossible before the euro’s launch, when Spanish companies were bound to the volatile peseta and domestic exchanges.
Depending on who is elected in the next election will determine if programs that were implemted now will contiue or not.  Policy that has been implemted recently has worked very well for Spain.  There should be no reason not to continue them, unless those reasons are war or major terrosit acts.

3. Views of Political LeadersCurrent Rating:2
Forecast 5 Years:3
Jose Maria Anzar is Spains Prime Minister since 1996.  He is part of the conservative Peoples Party.  Since taking power, there wre many fears that government policies would become more strict and secular-minded with Catholic traditionalism.  Mr. Aznar has been straight, efficient, clear-headed, honest.  Building on foundations laid by his modernising Socialist predecessor, Felipe Gonzalez, he has steadily freed Spains economy and overseen one of the fastest growth rates in the EU.  In Europe, his Spain is taken seriously; Mr. Aznar makes much of its new ascendancy in Latin America, where it has overtaken the United States as the biggest investor.  Mr. Aznar says Spain deserves to join the G8 group of rich countries.
One of his biggest downfalls though is his handlings with the Basque community and popular rise.  A big reason is that even the non-violent Basques are a tricky lot, while the terrorists of ETA are militarily hard to beat because they have enough popular support.  Mr. Aznar has himself been obtuse, by unwisely alienating the majority of Basques who do not back ETA.  In order for the Basque to be truly independent, Spains constitution would have to be ammended, the constitution that the Basque favored when voted.  The Basque claim it was a minority that voted in 1978.
In any case, as an economist, Jose Maria Anzar has brought good policy to Spain so that it can prosper.  He has won the favor of many people in Spain, but not the Basque.  If he continues to tunr the Basque away, there is no question that his popularity will fall.

4.Major Political EventCurrent Rating:3
Forecast 5 Years:4
Major events like elections and conferences affect how companies want to invest in a country.  Not only planned events, but tragic unplanned events like a terrorist act or bombong can affect what how companies decide to invest in a country.  There have been a number of terrorist acts by the ETA Basque party.  Their targets are political leaders, but innocent victims are caught in the midst of the freedom fight.  Events such as this will turn a striving country looking for foreign investment into a county begging for attention.
Recently thirteen ETA members were arrested being accused of killing 800 people in their 30-year struggle for Basque independence.  This is good for investment.  It shows that Spain is trying to rid its county of terrorism and working toward that goal.  Though there still may be the problem of Basque terrorism, this is a step toward decreasing the violence.
The talks to settle the Strait of Gibraltor has been occuring recntly as well.  Though it does not  seem like a political event, both Spain and Britian will be affected politiaccly and economicly.  The people that live in the territory do not want to see British rule change or replaced.  The Strait of Gibraltor is a major gateway from the Atlantic Ocean to the Mediterrainean Sea; to have influence there is to have influence in trading and commerce abroad.  This debate should not affect outside investment greatly though.

5. DemocracyCurrent Rating: 2
Forecast 5 Years:2
Spain has been a parliamentary democracy since its modern constitution came into effect in 1978 after the death of General Francisco Franco, whose authoritarian rule of four decades ended a bloody civil war.  King Juan Carlos I is the head of state, while President and Prime Minister Jose Maria Aznar of the center-right  Popular Party has been head of the government since May 1996.  The bicameral legislature, or “Cortes,” consists of the lower chamber or Congress of Deputies, popularly elected at the provincial level, and the upper chamber or Senate, which combines both directly elected and appointed seats.  In addition to the central government, Spain is divided into regional units or “autonomias” which have their own  governing bodies including a chief executive or President and legislatures.  There are also provincial and municipal levels of government with delegates appointed by the central government and locally elected officials.  Spain’s constitution created a system of asymmetrical autonomous regions with varying degrees of  power on whose “nationalist” parties the ruling national Popular Party depends to form its majority in Congress.  Their support is conditioned upon fulfillment of  specific regional goals, particularly the ceding of certain central government competencies, such as health care and police functions to the regional governments.

6.Tensions Between the U.S and the Host CountryCurrent Rating:2
Forecast 5 Years:2
Spain and the United States have a long history of official relations and are now closely associated in many fields. This association has been cemented in recent years by the exchange of high-level visitors. In April 1993, King Juan Carlos received a gold medal from the United States National Philosophical Society in Philadelphia on the occasion of its 250th anniversary, and in 1997 he was awarded the World Statesman Award by the Appeal of Conscience Foundation in New York. In April 1997, President Aznar visited Washington and met with President Clinton and other key Cabinet members. Among other things, they agreed to coordinate on Latin American policy. In July, President Clinton attended the NATO Summit in Madrid, where he had separate meetings with Aznar and with King Juan Carlos.

7.Support for Current GovernmentCurrent Rating:3
Forecast 5 Years:3
The most important achievement of the Constitution of 1978 is that it has contributed to solving the historic problems, which for over a century clouded the community life of the Spanish people. The establishment of the new State of Regional Autonomy, the regulation of the role of the Crown and the de-establishment of the Church, has thus become essential elements to channel by peaceful means conflicts, which had hitherto been endemic.
For the purpose of incorporating into the Spanish legal order the rules on the right of passive suffrage in municipal elections for European Community citizens living in Spain, on July 22nd 1992, the Congress of Deputies approved an amendment to Article 13.2 of the Spanish Constitution, as a first step towards the future shaping of European citizenship arising from the ratification by Spain of the Treaty on European Union. The Senate passed the amendment on July 30 1992 and received the royal assent from H.M. King Juan Carlos on August 27 the same year.
8.Influence of Anti-Business GroupsCurrent Rating:4
Forecast 5 Years:3
The anti business groups are formed within the political parties.  They show their influence through demonstrations, mostly peaceful, but sometimes violent.  Students attending universities have a very proud and loud voice opposing business.  The ETA, Basque national party, though mainly driven to fight for a soveirgn state, has been known to demonstrate to oppsose corporations and large industry.  The Catholic Church as well takes a roll in anti business affairs.
Though not anti-business groups, trade unions influence business and productivity.  Under the previous regime, there existed in Spain the so-called vertical unions, a corporative representation of the workers, controlled by the Government. In 1977, when the constitution was ratified, trade unions were legalized and with their new status, intensified their work. Article 28 of the Constitution states that the freedom to join a union and the right to strike, together with the exceptions to both rights, are the most important pillars for the development of the social and economic life of the country in a climate of freedom. Article 28 is interpreted in accordance with other articles of the Constitution. Among these is Article 7, which regulates relations between the unions and employers s associations, and 37, which guarantees the right to collective bargaining and recognizes the right of workers and employers to take labor dispute measures.

9.Public Opinion of Foreign OwnershipCurrent Rating:4
Forecast 5 Years:3
During the last fifteen years, foreign investment in Spanish real estate has gone through one boom and bust cycle. Since the beginning of the eighties, non-residents increased their net investment in Spanish real estate, especially after the entry of Spain in the European Community in 1986. Investment reached its nadir in 1989 with more than 2.5 billion US dollar, coinciding with the peak in the Spanish real estate market. As prospects became gloomier, and prices started to drop, foreign investments fell to below 1 billion US dollar in 1993, comparable with levels before the entry in the European Community. Since then, investments have recovered to some extent. In total, non-residents have invested more than 20 billion US dollar in Spanish real estate since 1980.
Spanish citizens have a content feeling about foriegh ownership.  The people do not look down at foreign owners but more what they do to the cultre and traditions held on the country.  The people are more worried about what happens to the towns and cities and hope to see they are not harmed.  Of the same importance is the influence that is directed to their children.  Children are most influenced by the media, therefore, they want to make sure they are not affect negatively by forieghn ownership.

10. External Threats of WarCurrent Rating:2
Forecast 5 Years:2
Spain does not have a history of external threats of war in the mid to late twentieth century.  Spain remained neutral during World War II while their neighbors France and Italy were involed in the war heavily.  Spain was involved in its Civil War before 1940.  There were never any countries that opposed or had reasons to attack Spain, even though Spains dictatot France sided with Germany.
Terrorism is a large issue in Spain today though.  The Basque community and their fight for independence has been running out of control in the past years.  There have been attacks on politician and innocnet civilians as the Basque continue their fight.  One of the major reasons for the Basque being so viscious is Anzars policy of ignoring the Basque issue.

C. Economic Indicators
1. Economic Growth Rate: GDP % ChangeCurrent Rating: 4
Forecast 5 Years:3
Spain’s mixed capitalist economy supports a GDP that on a per capita basis is 80% that of the four leading West European economies.  Spain’s accession to the European Community–now European Union (EU)–in January 1986 required the country to open its economy, modernize its industrial base, improve infrastructure, and revise economic legislation to conform to EU guidelines. In doing so, Spain increased GDP growth, reduced the public debt to GDP ratio. The Spanish Government under President Aznar worked to meet Maastricht Treaty requirements for economic and monetary union; the fundamental challenges for Spain remain to continue reducing the public sector deficit, to further decrease unemployment, reform labor laws and investment regulations, lower inflation, and raise per capita GDP.

2. InflationCurrent Rating:4
Forecast 5 Years:4
There, inflation increased to 3.5% in June, up from 2.9% last year and from 1.4% in 1999. As in the euro zone generally, higher energy prices account for much of the acceleration. But unlike the pickups in Germany, France, and Italy, which account for 74% of the euro zone economy, faster inflation in Spain also reflects rapid economic growth and a sharp drop in unemployment, which makes it easier for the inflationary impacts of the weak euro to filter through. Spain’s economy grew 4.1% in the first quarter from a year ago, and many analysts expect growth this year to exceed the government’s recent 4% projection.
With markets slowing down there does not seem like any immediate threat of inflation taking over.  Like the US and world markets, Spains also has to recover from the aftermath of Septembers terrorsit attacks.  People are just not spending money or travelling the way the used to.  There is no major threat of inflation.

3. Unemployment RatesCurrent Rating:5
Forecast 5 Years:4
Spains unemployement rate is at about 14%, which is high among the rest of the European Union.  One of the requirements in joining the European Union is to reduce the unemployment rate.  They are working toward lowering it significantly so that the economy can thrive and gain status and integrity in the European Union.  Prime Minieter Jose Maria Anzar has been work hard to to lower the unemployemnt rate by implementing certain programs.
First, Spain has to grow much faster than its Euro-partners. Second, this growth has to meet some conditions.  Balanced growth requires a change in the composition of demand, a lower share of consumption and government expenditures and a higher share of investment.  Moreover, Spain will have to achieve a lower inflation rate than its partners, perhaps even deflation.  The least it can be said is that it may not be easy.

4. Investment PoliciesCurrent Rating:3
Forecast 5 Years:3
Financial knowledge, international expertise and cutting-edge technology are all essential in succeeding in today’s financial and investment market. Fortunately, for the expatriate living in Spain, there is a choice available when deciding exactly how, where and when to invest that hard-earned cash.
For many foreign residents, particularly those from the UK, Gibraltar’s various financial institutions are the preferred option when looking at such financial packages as investment, savings, life assurance, annuities, traded endowments, trusts, mortgages, bonds and foreign currency deposit accounts.
Many of these offshore life companies and fund management groups also offer a convenient form of pension planning via a flexile savings plan. Investing money on a regular basis with a major company in a recognised tax haven will provide security and enable you to plan properly. In particular, those uncertain of how long they will be living in Spain should choose a savings facility offered by an offshore company which has no fixed term and no surrender penalties. It is just a matter of looking at all the options available and finding the one which best suits your particular financial situation and requirements.

5. Fiscal PoliciesCurrent Rating:3
Forecast 5 Years:4
Fiscal policy has been based on Maastricht criteria of participation in the monetary union.  Deficit reduction was achieved in 1995 and 1997 from the cut in primary current expenditures and reducedcapitla inlays.  The pace of fiscal adjustment slowed in 1998, with reductions in the deficit arising from the cyclical upswing and declines in interest rates. The structural primary surplus, which excludes these factors, was broadly unchanged.
Strict control of spending by the central government and territorial administrations must be the bedrock of economic policy. The law, however, should not operate in away that triggers procyclical actions at any level of government-such as investment cuts or tax increases when the economy is weakening. Under monetary union, and with the nature of global shocks evolving, this is important. Winning the battles of the past in fiscal management has created room to accommodate cyclical fluctuations, in line with the rules of the game of the EU Stability and Growth Pact. But Spain’s fiscal credibility is of recent date. Policy-makers can declare victory-but they cannot afford to give up hard-won ground. Accommodating cyclical fluctuations must not open the door to a loss of fiscal discipline.

6. Foreign DebtCurrent Rating:3
Forecast 5 Years:3
In the last years Spain has been forced to live within its means and state spending has been slashed to control the soaring budget deficit. Like many European countries, Spain has found that it can no longer afford to pay the high social security benefits that its citizens have become accustomed to in the last few decades and this continues to be one of the most pressing concerns of the current government  together with revamping the antiquated labour laws which stifle small business incentive.
At present, the Kingdoms foreign funding plays a complementary role to domestic funding in euros. Apart from the possibility of achieving attractive funding levels through arbitrage opportunities, one of the main objectives is maintaining the relationship with the global investor base that buys Kingdom of Spain Bonds but is still not a regular player in the Spanish Government Debt market.

7. InfrastructureCurrent Rating:2
Forecast 5 Years:2
Ths infructure of Spain is for the most part very strong.  Almost all of the road ways are paved for easy access for consumers and businesses.  The manufactoring industries rely on maintained roads, railways, harbors and waterways for business to conduct smoothly.  A major waterway that is under question in recent times is the Strait of Gibraltor.  Britian and Spain possess territory around the waterway.  Britian has had a major influence there for some time.  The citizens that reside there anjoy the British rule.  They do not want to see rule that has Spain as the strong posesser.
There are planned talks to discuss the destiny of the Striat of Gibraltor during summer 2002. Josep Pique of Spain and Jack Straw of Great Britian have talked on many topics regarding this important waterway, including cooperation and sovereignty.  Both men are major heads of state in their respective countrie and plan to solve the gibraltor issue in the coming year.

8. Remittance of EarningsCurrent Rating:3
Forecast 5 Years:2
Spain is taking steps to improve its investment and brokerage entities.  For example, it has implemented new regulations to strengthen financial reporting by collective investment operators.  Furthermore, the government has begun to recognize new types of investment organizations such as venture capital funds and companies.  Additionally, Spain has created tax relief measures to eliminate the extra costs involved in using this medium for investments.  The measures have led to a notable increase in the number of these institutions and in the volume of their investment.  Property investment funds also exist in Spain, thus completing the process of adaptation to and standardization with collective investment instruments in the E.U.
The adoption in recent years of required E.U. regulations completed the liberalization of the Spanish financial sector.  For example, exchange controls and capital movements are now fully liberalized.  Between 1991 and 1993, Spain implemented several key Royal Decrees.
They were:
Foreign transactions (RD 1816, December 1991) were modified in January 1993 (RD 42) including foreign investment.
Spanish investment abroad (RD 671 and 672, July 1992) Some main features of Royal Decree 1816/1991 include:
Safeguard clauses: under exceptional circumstances, the law authorizes the Spanish government to prohibit or limit certain financial transactions with non-residents if they affect Spanish interests.
Documenting transactions: for statistical purposes, banks must document money transactions.  Declaration to the Bank of Spain: notification must be given to the bank when certain transactions occur between residents and non-residents such as: financing and deferral of payments for over a year offset of credits and debits on commercial and financial transactions and financial loans received from non-residents.

9. Per Capita IncomeCurrent Rating:4
Forecast 5 Years:3
Spains per capita income is average as compared to the United States of America and the entire world.  Those factors are of course dynamic given current markets, trends, and political state of affairs.
Spain is reaping the benefits of long-term economic reforms that started hesitantly and gained conviction in 1986, when it joined the EU. In 1995, corporate tax rates were slashed from 40% to 35%, a big draw for new investment. Moreover, in the past two years, bold moves by the government of Prime Minister Jose Maria Aznar, elected in March 1996, have accelerated the momentum for change. Aznar has pushed through $1.3 billion in government spending cuts, a flat capital-gains tax of 20%, and a freeze on the hiring of civil servants.
Spain also has gone the furthest in distributing economic decision-making authority to local governments such as Catalonia to shape their own future. As Europe’s borders fade and regions grow more powerful, that decentralization could give Spain added economic kick. For Spain’s young generation, staying among the frontrunners in the new Europe is everything. ”The feeling is this time we can’t be left out,” says Javier Loizaga Jimenez, a partner at Madrid’s
10. Competitive ForcesCurrent Rating:4
Forecast 5 Years:2
International firms in Spain is a special kind of in dicator in the economic sector of foreighn direct investment.  Depending on how many firms and what kind of business they are doing abroad shows a strong in tension of foreign firms to invest there.  Spain is not a developing nation in industry and manufactoring , but a place to start investing in technology and information sector.
The Information Technologies sector, which includes consumer electronics and telecommunications, grew between 13 and 14 percent during 1998, almost five times more than the overall growth in the national economy.  The sector as a whole includes telecommunications (telecommunications equipment and services), computer products (hardware, software, services, hardware maintenance and supplies) and value added services (network services, information services, messaging services, transactions and others).

D. Socail  Indicators
1. EducationCurrent Rating:2
Forecast 5 Years:2
For most parents, re-locating to Spain, their primary concern is where to educate their children. The days are long gone when it was considered imperative that you kept your offspring in the same school for their entire scholastic life.  Even in the UK now, it is increasingly common to change schools, particularly for the all-important Sixth Form year. However, changing schools in the same country is one thing  changing the country, as well as the school, is quite another.  State education is the responsibility of the Ministry of Education and Science, although authority can be delegated to regional governments. This is the case in in Andaluca where the Junta de Andalucia has the responsibility for the
Attending a local state school helps children integrate into the local community and learn the language and is highly recommended if you plan to stay in Spain indefinitely. Although it may not appeal initially, given the choice many foreign children prefer to attend Spanish school and become part of the local community. It is worth noting that, whereas it is                fairly easy to switch from a state school to a private school, the reverse is not the case. If you need to move a child from a private school to a state school it can be difficult for that child to adjust, particularly a teenager. educational system (including higher education).
Like many European countires, Spain values education very highly.  They want to see all attendees succeed for a prosperous future for themselve and Spain.  Spains education is stringent like other European education systems to compete for the future graduates and employees.

2. CrimeCurrent Rating:5
Forecast 5 Years:5
While most of Spain has a low rate of violent crime, the principal tourist areas are experiencing increasing crime directed against tourists.  Madrid and Barcelona, in particular, have reported a growing incidence of muggings by gangs brandishing weapons and/or using force.  Travelers using public transportation should be alert to the potential for muggings or pickpocketings. Crimes such as pickpocketing, robbery, and theft from cars are frequent, and scams are often employed.  For example, thieves often attempt to distract their victims by squirting mustard on their clothing, asking for directions on the street, or otherwise diverting attention from an accomplice.  Thefts of small items like radios, luggage, camera or briefcases from parked cars are a common problem.  Roadside thieves posing as “Good Samaritans” to persons experiencing car and tire problems typically attempt to divert the driver’s attention by pointing out a mechanical problem, and then steal items from the vehicle while the driver is looking elsewhere.  Drivers should be extremely cautious about accepting help from anyone other than a uniformed Spanish police officer or Civil Guard.  Travelers who accept unofficial assistance are advised to protect their valuables by keeping them in sight or locking them in the vehicle. Andorra has a low rate of crime.

3. Labor ForceCurrent Rating:3
Forecast 5 Years:2
Britain and Spain have drafted joint proposals for reforming the labour market and creating jobs in the European Union. According to a newspaper report in the Spanish daily “El Mundo” the Spanish Prime Minister, Jos Maria Aznar, and his British counterpart, Tony Blair, want to promote a flexible labour market similar to the one in the United States, but with a greater degree of job stability. The proposals will be discussed at the EU summit in Vienna next month. According to the newspaper this is the first time that Spain has endorsed a joint initiative of this magnitude with another EU member country.

4. Ethnic ConflictCurrent Rating:5
Forecast 5 Years:6
The Spanish state embraces a huge number of ethnic and cultural groups. As the country is divided into regions, people often identify themselves by their homelands. There are many regional groups with different cultural traditions and languages, such as the Basques, Catalans, and Galicians.  Virtually all Spanish are Roman Catholics. Until 1978 this was the official religion of Spain, but there is now religious freedom, and the country is becoming more secular. The Church still maintains a special status and has a high income. A lot of this money is donated to the poorest members of the community and charities.

5. Social CohesionCurrent Rating:5
Forecast 5 Years:6
The biggest social issues in Spain today are the handlings of the Basque question and the ETA, talk regarding control of the Strait of Gibraltor, and terrorism in general after the September 11th attacks in the US.  The Basque question has been very large for more than thirty years.  They are pushing for independence from Spain and a strong political voice.  Their independence is being opposed by the current President Jose Maria Anzar, who thinks that ammendment to the Spanish constitution is the route that will have to be taken for Basque independence.

6. Quality of LifeCurrent Rating:5
Forecast 5 Years:6
One of Spains biggest social problems is the increasing number of homeless people.  There are now an estimated 273,000 living on the streets or in hostels while 15 percent of housing remains empty. Unemployment and family breakdown are the two main contributory factors to homelessness in Spain.  The Government does not allocate enough funds to make adequate provision for the whole population and consequently low-income families suffer first. For them, renting or buying a house is an expensive option.  Council houses are not being built at a sufficient rate to combat the problem, and basic social benefits are not enough to cover family expenses.

7. Family StabilityCurrent Rating:2
Forecast 5 Years:2
Family structure and stability is based on traditional values from the past and religious beliefs.  The majoriy of Spaniards practice Roman Catholisism, while some practice Islam.  They hold their traditions close and try to maintain those traditions into everyday life.  With those such values, citizens and establishment try to keep a stable and safe lifestyle.  There is no major risk if it is based on family stability.  Spains traditional ideas keep are kept strong through religion.  Parents keep their children discipline; they do not let an outside forces influence their lives.

8. BriberyCurrent Rating:3
Forecast 5 Years:4
The corruption factor in Spain is not as evident as the domestic terrorist factor is.  Spains leaders and government are so fixed on ending terrorism and ending its infuence.  They have been backed by many strong countries to end ETA threats and attacks: Great Gritian, Italy, France and Portugal.  They all have a common threat that exsist in everyones respective country.
Bribery though does not affect Spain, but there is eveidence of lobbying.  Lobbyist are pushing for issues regarding issues against the EU.  Even though under the EU, Spains economy is much stronger and influential.  Some EU regulations are restricting on citizens, businesses and corporations.  When money starts getting involved in lobbying this can be considered an accepted form of bribery which can get out of hand.

9. Cultural BarriersCurrent Rating:4
Forecast 5 Years:5
A solution based on the recognition to the Basque population of some universally accepted rights: the right to self-determination, and the territorial unity.  ETA has officially sent the proposal to the Spanish government, who hasn’t answered yet. Likewise, ETA addresses to the Basque society for this proposal to be discussed by political organizations, trade unions, social movements and by the whole of the society, because the final word and decision must be taken by the Basque population.   As the conflict continues barriers will be harder to overcome especially those between cultures.  Territorial independence is important to people throughout the world.

E. Overall County Total
Current5 Year Forecast
Overall Total:9486
Overall Average:3.242.97

What is Spains risk level?
Spain is at moderate risk level currently and that holds the same for the next five years

Which sector is strogest?
Spains political sector is the strongest.

Which sector is weakest?
Spains social sector is the wekest.


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Giles, Ciaran.  Spain, Britain Predict Gibralter Deal.  21 November 2001.

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