Airports are usually noisy places, but at Ciudad Real in central Spain the silence on a weekday morning is broken only by the sound of birdsong.
As Spain struggles to cut its budget deficit to avert another eurozone sovereign debt crisis, and as its politicians prepare for local elections, Ciudad Real Central – one of the country’s largest and most modern international airports – has become a monument to the financial folly born of the property boom and exacerbated by regional politics.
“It’s the silent airport,” says an airport employee, finishing her coffee in the cavernous departure hall. It is a Thursday, and there are no passengers because not a single flight is scheduled to depart.
“An airport in the middle of the desert. It’s scandalous,” says Lorenzo Bernaldo de Quirós, partner at Freemarket Corporate Intelligence and a fierce critic of what he sees as excessive devolution leading to waste of public money. “Every province wants an airport, just as they all want a university.”
One airline – Vueling, the low-cost arm of Iberia – runs two flights a week to Paris and four to Barcelona, with help from regional government subsidies. In winter, private jets occasionally bring wealthy hunters to shoot partridge and deer.
To critics of Spain’s devolved system of government, with its 17 autonomous regions, 50 provinces and 8,100 municipalities, the airport was a predictable but avoidable fiasco.
The site is next to a town of just 72,000 people on the sparsely populated Castilian plain and lies more than 140 miles from Madrid. It was even named after Don Quixote, the deluded Castilian gentleman of Cervantes’s famous novel, before wiser heads renamed it simply “Central”.
The airport, which has been in bankruptcy proceedings since mid-2010, officially cost €450m ($620m), but the bill reaches about €1bn when publicly funded infrastructure and running costs so far are included.
Although launched by local private investors, the project has been fulsomely supported by the regional government of Castilla La Mancha and was financed by CCM, the regional savings bank, or caja. In 2009, CCM became the first Spanish caja to be rescued during this economic crisis. It received €3bn in aid from a deposit guarantee fund, now the airport’s largest shareholder, and was absorbed in a merger backed by €1.5bn from the public bank rescue fund.
“In Spain, given the tremendous growth of recent years, people thought that anything could be done, that it would be easy and quick and would make lots of money,” says Francisco Cañizares, a municipal councillor in nearby Ciudad Real and a member of the right-wing Popular party (PP), which opposes the Socialists currently in charge of the central government and the region of Castilla La Mancha.
“In principle it was a private airport, but the ones who put in most money were public, essentially CCM.”
PP leaders, who are expected to do well in this year’s regional elections against their Socialist rivals, sense the public mood is turning against waste and bureaucracy in Spain’s multi-tiered system of government. “Spain can’t compete in Europe or the world with autonomous regions aspiring to become mini-nations,” said José María Aznar, former PP prime minister, recently.
Bond market investors appear to have accepted that Spain has brought its central government deficit under control, but they are now focusing on the growing burden of regional and municipal debt.
When new regional governments take over after the May elections, says Mr Bernaldo de Quirós, they are likely to find the accounts in worse shape than previously believed, as happened in Greece in 2009 and in the Spanish region of Catalonia at the end of last year. “People will question the reliability of the public accounts,” he says.
Defenders of the status quo insist Spain is no worse than most other European countries. “The level of development that Spain has now would have been impossible without the autonomous regions, because it’s impossible to run a country with the centralised territorial system of the 19th century,” says Javier Burón Cuadrado of law firm Cuatrecasas, Gonçalves Pereira, who advises the association of municipalities and provinces.
Even the airport has its defenders. They point out that it was conceived when Madrid’s Barajas airport was congested, was supposed to have a high-speed railway station, and was opened in 2008 in the depths of the economic crisis. José María Barreda, Socialist premier of Castilla La Mancha, insists the airport’s moment will come, and denies it was a “get-rich-quick scheme”.
Meanwhile, tranquillity reigns at the sleepy airport. There is, briefly, a noise like that of an approaching aircraft. But it is only the whoosh of a high-speed train on its way from Seville to Madrid.
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