Negative Readjustment
Despite the Economy Minister, Elena Salgado, claiming she could see the first “green shoots” of the economic recovery on Wednesday, the local picture does not look as bright. The Balearic Minister for the Economy, Carles Manera, did not share his superior’s optimism, and would be re-evaluating the Gross Domestic Product, (PIB – Producto Interior Bruto), the market value of all final goods and services produced within the islands. This will be the second time the over-optimistic Govern has had to recalculate the figure. Towards the end of last year Manera forecast growth would be around 0.8 per cent over the course of 2009. Just months later, however, the minister admitted he had been slightly ambitious in his calculations, whilst readjusting the figure which he reset at between 0.2 per cent and 0.5 per cent. Unfortunately this will once again be changed, and Manera will finally admit the islands are in recession as he predicts negative growth during 2009.
He acknowledged he did not see many green shoots of recovery and did not want to deliberately confuse the public. He continued that his administration’s income would be down around 35 per cent during the first quarter of the year, which would also lead to a decrease in Treasury funds which would undoubtedly ensure they had to revise the Government’s deficit.
The comments from the Central Government’s Minister, Elena Salgado, came as consumer confidence hit a year high in April, while new jobless claims rose at their slowest pace in nine months.
However, critics said the comments should be taken in the knowledge the European elections are just around the corner, and both Salgado and Prime Minister Jose Luis Zapatero desperately need some good news if they are to avoid being punished at the polls. However, this is a key time for the Prime Minister, and he is trying to remain positive as the election draws closer. "We are going through some bad months, but there is a certain and solid recovery on the horizon," he said in an interview with the television channel Cuatro. "In the second half (of 2009) we are going to have some data that points to a recovery.... We are going to emerge strong from this crisis."
Data released the previous day failed to support Zapatero’s new found confidence. It showed Spanish industry suffered another record slump in March but service activity fell at a slower pace in April. In addition output at Spanish factories and mines fell by 24.7 per cent in March, the eighth successive monthly fall.
Supporting this theory the European Commission said the global crisis, as well as the collapse in the construction industry, would ensure Spain would be the last economy in the European Union to exit recession, probably in 2011.
The downturn in the Spanish economy is in clear contrast to its dynamic rise during the beginning of the 21st Century on the back of a booming construction industry. This saw the national economy grow to record levels, as Spain surpassed Italy and drew ever-nearer to France. However, the credit crunch put an end to all of this and sent the country into a downward spiral, which according to many is far from over. Unemployment has been the main casualty, with over 4 million people currently out of work, 17 per cent of the population, with most predicting it will hit 20 per cent by the end of the year.
"Everybody is desperate to look for the positive signs in the economy -- you can't call them positive, it's just there are some incipient signs of light at the end of the tunnel," said analyst, Jose Garcia Zarate, at the 4Cast consultancy

AROUND THE ISLAND
A Tourist Study
The much anticipated Ibiza-edition of the “Libro Blanco”, a study of tourism in the Balearics over the next 20 years, and carried out by around 40 experts, has been released. The authors of the manual include the Balearic Government, Sa Nostra, the Chamber of Commerce in Mallorca and the Balearic University. The co-author of the book, Antoni Riera, explained the main conclusion was that the island needed to change its tourist model over the next ten years, or else it would suffer dire consequences. He started by underlining the importance of tourism to all four of the Balearic Islands, but especially to the Pitiusas (Ibiza and Formentera) which relied almost totally on the industry.
He said the general theme of the book was very upbeat but criticised some political decisions which have been made recently. He said the island needed to remain competitive, which meant more than just a bit of painting each year.
He criticised the reliance of the island on the clubs and bars, and said it was not promoting the natural beauty and biodiversity of the island, or the fact Ibiza Town was a World Heritage Site.
He claimed that another of the endemic problems on the island was the fact tourists were seen as an inconvenience by many of the locals, despite the fact they had helped the island grow extremely rich, and this feeling was transferred to the tourist. He said the success of a tourist destination should not be measured in the number of visitors, or the average tourist spend, but on the quality of life of the people living here.
He continued by explaining that the manual dealt with the problem of the labour market on the island. Firstly, he insisted it needed to be more qualified, but also that it should be aware of the integral part it plays in the success of the island. Those in the service sector remain on the front line, and will continue to play an important role in the tourists’ final impression whilst holidaying here.
He said the “them and us” attitude needed to change and both the public and private sector needed to become more integrated and work together.
He finished by explaining that those politicians looking for short term fixes may well have a small positive effect, but would certainly not help in the long term success of the island. He said that price was not as important as experiences, and in general the 21st Century tourist wanted experiences he could not enjoy in his own country. If Ibiza could be innovative, leave the comfort zone of “sea and sand” and was able to offer something different it would have a successful future. However, if this was not the case it would become obsolete and forgotten. He finished, “If the Balearics does its homework and once again becomes a market leader in the sector, others will continue to follow us, like they did before. However, if we continue to do things the same way, we will be overtaken”.

Airport Increase
There was some positive news this week as the Airport Authorities, (AENA), reported the number of passengers using the island’s airport in April rose for the first time this year. During the first three months of the year visitors using the facility declined by 12.2 per cent. However, April saw some recovery with numbers up 8.8 per cent on 2008. These positive figures were seen right across the Balearics, with both Palma and Mao 1.5 per cent and 2.3 per cent up respectively. These were the only major national airports to see increases from 12 months ago with Barcelona down 7.8 per cent, Madrid down 2.3 per cent, Valencia down 15.9 per cent and Malaga also down at 5.1 per cent.
During the first four months of the year a total of 1,246,352 tourists have visited the Balearics, 9.3 per cent of the national total, and an increase of 5.2 per cent from 2008.
The figures were released as all of the major airlines operating internal flights promised to maintain the same number of planes as 2008. This will ensure there are between nine and eleven flights daily to Madrid, and nine or ten to Barcelona.

Positive News
The Balearics could be in for a late surge of high-season bookings according to leading experts in the tourist sector. The predictions were led by the chief executive of Thomas Cook, Manny Fontenla-Novoa, who claimed the more popular destinations until now, including Egypt and Turkey, were starting to fill up which meant most late bookers would be left with little option but to book Eurozone destinations.
According to several leading online travel companies Mallorca will remain the number one destination for British holidaymakers in 2009, despite the strong euro. Bookings have been helped in recent weeks by a strengthening pound – it is currently worth around 1.10 euros, down twelve per cent since last summer, but up ten per cent since its low in December 2008.
The weak pound has been counteracted by serious reductions in hotel rooms in Spain and the Balearics, with discounts rising to 40 per cent in some resorts. This will ensure the UK’s love affair with the island is set to continue, with bookings from the British market set to be down between six and eight per cent over the course of the year, a figure described as manageable.
The increase has also been helped by a British lack of faith in the weather this summer. Despite Met reports claiming the UK was in for a long, hot summer, it appears most are not willing to take the chance, and will be booking summer holidays abroad to ensure good weather.
Ibiza is also set to benefit from a huge rise in the cost of holidays within Britain. On the back of a recent surge in popularity some hoteliers have hiked up prices by up to 60 per cent, ensuring it will be cheaper to come here than holiday on the nearby British seaside.
However, not all eurozone countries are benefiting from the renewed interest in the region, according to Fontenla-Novoa. The "Maddie effect" continues to have a negative effect on bookings to Portugal, which are down 30 per cent from last year

Big Switch Off
With just over four weeks to go until the “switch-off”, a total of 90 per cent of homes on the island are able to receive digital television. The Councillor for the Interior, Pilar Costa, explained the final antennas were being out in place over the next few weeks but that there would remain a few “black holes” unable to receive the signal. However, this number would be similar to those currently unable to pick up the analogue signal, although she promised a long term solution would eventually be found. Sofia Hernanz, Madrid’s representative on the island, claimed the Central Government was looking at installing digital satellite systems to ensure all areas would be able to receive a signal.
A total of €12 million is being invested in the Balearics to ensure the islands are able to receive the digital signal. Due to its scattered population and varied terrain most of the money will be spent in Ibiza. At the moment there are currently fifteen antennas in place across the island, whereas just two were necessary to cover the whole of Menorca.
Costa gave no hint the “switch-off” could be delayed, despite her announcement coming just days after several autonomous regions confirmed they would be delaying their dates. The previous week the northern region of Galicia officially announced it would be delaying its regional digital switch-over, and now a total of 14 projects are set to go the same way.
Spain's Ministry of Industry explained the problem lay in the fact there were still a lot of areas without digital coverage or others with a bad one. Some regions are more advanced than others in reaching the same percentage of coverage in digital as in analogue, as well as the levels of household access. Despite this they claimed the delays would not affect the national switch-over taking place on April 3rd 2010, several months after the Balearics cut-off point for having everything in place.
Over the next two months an information centre will be set up in Vara de Rey, Ibiza Town, to offer advice and help to worried citizens about the upcoming changes. The office will be open from 10:00 a.m. until 9:00 p.m. A mobile information unit will also be touring the island, stopping in Formentera on 6th June, San Antonio on 7th and 9th June, San Juan on 8th June, San Jose on 10th June and Santa Eulalia on 12th June.

Popularity Swing
The economic crisis during the last year is beginning to test the popularity of Island President, Xico Tarres, as a new poll showed he had lost a significant proportion of the electorate, just two years after taking over. The survey carried out by the Balearic Institute of Social Statistics, (IBES), for the Ultima Hora newspaper showed just 37 per cent of the population believed Tarres was doing a better job in office than the previous occupant, and now opposition leader, Pere Palau, (whom he beat by just 35 votes to take the job). This compared to 34 per cent who believed he was doing a worse job, and 29 per cent who claimed they did not notice any difference between the two leaders.
Further investigation showed Tarres scored just 4.5 out of 10 from those questioned, down 1.5 points from a year ago. Meanwhile his rival has not budged and remained on 4.4 points, just 0.1 behind.
After two years in power just 46 per cent of the respondents thought his mandate had been a success so far, whilst 40 per cent said it had been a failure, with the remaining 14 per cent abstaining.
Not surprisingly the main reason for the displeasure of the electorate is the economic downturn, with over 50 per cent claiming this was their main concern with the current administration. Unemployment remains their main worry, followed by the uncertainty of the current tourist season (20 per cent), with transport to and from the island, including price and frequency, the main concern for 19 per cent of those questioned Down in 5th place was the imposition of Catalan by the Island Council, which is bothering eight per cent of the population.
The study was part of a regional survey which showed Tarres was the least popular leader across the three main islands, with the president of the Island Council in Mallorca, Francina Armengol Socias, awarded 6.3 points, whilst his Menorcan counterpart, Marc Pons, received 5.8 points.
The president, however, dismissed the survey, and said he was happy with the way things were going, announcing several new projects would get under way after the summer including the renovation of the Military residency, and the rebuilding of the San Miguel road. He continued that the island was bearing up well in comparison to most places, and would ride out the economic crisis.

Bad Debt
An astonishing two out of every ten people currently renting accommodation in the Balearics will fail to pay their rent at some point during the year, according to new data released last week. The figures highlight the current problems being caused due to the rise in unemployment levels over the last few months, underlined by the fact those who normally rent properties are usually those with the least income, and unstable job situation. And all this despite the fact the average rent in the Balearics has fallen 11.7 per cent since July 2007.

More Details
The Minister for Health, Vicenc Thomas, was on the island last week to go over the latest details concerning the new hospital planned for Can Misses. He said the project was being touched up and would hopefully be ready to be displayed in public by the middle of June. It would then be put out to tender, with the first stone being laid in November.
Thomas was at the meeting with the architect of the project, Lluis Vidal, who revealed some of the finer points of the plans. In total the hospital will have a floor space of 72,148 m2, just under three times the current size, and will consist of several buildings, with none more than four floors high. He added it had been designed to cope with a maximum population of 160,000, 40,000 off the current total. There will be a total of 199 rooms for patients, half of which will be single rooms.
In addition most units will also see an increase in capacity, the most glaring being an increase in the intensive care unit from nine beds to 16, and A&E which will grow to 43 beds.
New additions will include a premature baby department, as well as a children’s out-patient department.
According to Vidal the plans for the hospital have been based on a “curative” design, popular in the 21st Century, due to its help in ensuring a faster healing process for patients. The low-rise buildings will be constructed in modules, and include a lot of light and green areas.
In the plans the old hospital will be used for administrative offices, storage space, kitchens and social healthcare.

GPS Closure
The Island Council has ordered the closure of the hotel, Costa Sur-Sol Post, apartments in the bay of San Antonio for not possessing the necessary permits to operate. The ban comes with a €60,000 fine. In addition to this the owners of the establishment, Grupo Playa Sol, (GPS), have also been fined €10,000 for various other offences.
Another hotel within the chain, Hotel Marco Polo, was also fined €10,000 for not having the proper permits, but this will not be ordered to close.

Sales Date
The summer sales in the Balearics will start on 7th July this year. The Balearic Government agreed the date to ensure parity across the islands, unlike last year when sales began in Mallorca three weeks before those in Ibiza and Formentera. The sales period will continue through until 7th September.

Election Time
The opposition leader, Mariano Rajoy, visited the island on Saturday to take part in an election rally as part of the Popular Party’s campaign trail to the European elections on 7th June. In front of around 600 supporters Rajoy spoke only briefly about Ibiza saying the present Government was creating more problems for the tourist industry, whilst offering no solutions. He claimed that after denying the recession for the first six months, Zapatero had then spent the next six months dithering, and not offering any concrete solutions. He claimed his was the party that had the answers and promised the PP-party would win all five Town Halls, the Island Council and the Balearic Government at the next elections in 2011.

Film Festival
The 3rd Ibiza Film Festival kicks off today, with Cuba Gooding Jr. presiding over the panel of judges. Films this year include productions from China, Cuba/Spain, United States, Serbia and Canada/Ireland, none of which have previously been shown in this country, and two of which will be receiving their world premieres.
Cuba Gooding Jr. was born on 2nd January 1968, and is without doubt best known for his Academy Award-winning portrayal of Rod Tidwell in Jerry Maguire, and his critically acclaimed performance in John Singleton's Boyz n the Hood, in 1991.
His first job as a professional entertainer was as a break-dancer performing with singer Lionel Richie at the closing ceremony of the 1984 Summer Olympics in Los Angeles. After high school, Gooding studied Japanese martial arts for three years before turning his focus to acting. Early on, he landed guest starring roles on shows like Hill Street Blues in 1981, and MacGyver in 1985, with his first major role in the 1991 box office surprise, Boyz n the Hood. He followed this success with roles in major films like A Few Good Men in 1992, Lightning Jack in 1994, and Outbreak in 1995.
However, his biggest role to date came a year later in the smash hit, Jerry Maguire. In the film Gooding plays an American football player fighting for a new contract, supported by his agent played by Tom Cruise. His catchphrase from the film “Show me the Money” remains one of the most popular movie quotes of all time. For the role he received an Oscar for Best Supporting Actor.
He later starred opposite Dustin Hoffman in Instinct, Robert de Niro in Men of Honour and Ben Affleck in Pearl Harbour. He has just released The Way of War.

IBIZA TOWN
Internet Town
Ibiza Town is set to offer a WIFI service across the entire municipal by the end of the summer. Councillor Joan Rubio announced on Wednesday the Mallorcan company, Level Electronics SL, had been awarded the contract at a cost of €113,000, and hope to have it installed by October.
Rubio explained that the entire municipality would be able to connect to the system via the 5 GHz band, which only the latest computers will be able to pick up. However, he continued that a 2.4 GHz band, which is far more common in most domestic computers, would also be available in the more tourist hubs, including the whole of Dalt Vila, Vara de Rey, Can Misses, es Botafoc and sa Colomina. However, he revealed those unable to connect to the 5 GHz band would be able to buy an adapter to allow their computer to pick it up.
The service is not going to be free, as state law prevents this, but Rubio claimed the cost would be minimal, although how this will be charged has not yet been decided. Users will also not be able to download videos, or other large files to ensure the system does not become saturated.
In total around 20 antennas are going to be distributed around the municipal to ensure coverage, with all being attached to public buildings.

Water Problems
A leak in the pipe taking water from the municipal purifier in Ibiza Town caused the machine to be shut down towards the end of last week. However, due to the new municipal interconnections installed last year by the Island Council the general public was not affected, as production from the San Antonio purifier was increased.
Technicians first became aware there was a problem after water with an extremely high salt content appeared close to the Pacha roundabout at 5:30 a.m. on Wednesday. Immediate checks soon revealed there was a problem with the tube which discharges the salty water produced during the desalination process.
Currently the purifier is producing around 6,000 cubic metres a day, which ensured the San Antonio purifier was able to cope with the increase, as technicians increased its production from 7,000 to 11,500. The purifier is able to produce a maximum of 17,000 cubic metres a day.
Work continued throughout the week causing significant traffic delays close to Suministros Ibiza, as technicians claimed the leak was far more complicated than at first thought.

SAN ANTONIO
Noisy Nuisances
San Antonio is to introduce new legislation to stamp out noise pollution throughout the municipal. The new regulation will hopefully be introduced in time for the summer, and will affect both residential and commercial areas.
The legislation will establish six different types of zone, from 1 or mute zone where no noise will be permitted, to zone 6 where much more will be tolerated.
As far as residential areas are concerned anti-social behaviour will not be tolerated. Firstly there will be a serious clampdown on those organising illegal parties in private houses. Fines which were previously set at a maximum of €250 have been increased to €300,000 for the most serious offenders. Those responsible will include the owners of the property, as well as the person organising the party.
Those people who scream and shout, and generally disturb their neighbours will also be liable for fines of €180-€3,000.
In addition the limit for carrying out work in the home, with high noise or vibration levels has also been changed, with work unable to be carried out from Monday-Thursday 10:00 p.m. - 8:00 a.m. with Friday and Sunday, as well as fiestas, from 10:00 p.m. – 9:30 a.m. However, Councillor Jose Ramon Serra Pilot said this timetable still needed to be studied carefully and there was a significant chance the hours could be shortened to allow work to carry on until midnight.
Boat owners failed to escape the new legislation, and those caught breaking noise pollution regulations, will also be liable for heavy fines.
However, the moves by San Antonio to control noise pollution could be counteracted by comments during the week by the Balearic Minister for the Environment, Miguel Angel Grimalt, who is trying to push through new regulations which will allow building work to carry on during the summer months. Current legislation prohibits all outside building work from taking place in tourist areas from 1st May until the end of summer. However, as the minister looks to kick start the economy, he said his administration would be falling into line with European directives which encourage work all year round but put limits on the amount of noise which can be produced. After a barrage of criticism the minister later back-tracked slightly and announced the tough laws limiting noise levels in tourist areas would ensure very little work would be allowed to take place in sensitive areas.
In other municipal matters Mayor Jose Sala announced he would be meeting with officials from the Balearic Government to try and negotiate the transfer of Passeig de ses Fonts, - the seafront area where the fountains are located -, to the Town Hall. Since 1982 part of the area has come under the jurisdiction of the Port Authority, although the Town Hall has continued to maintain the area, cleaning it and retiling it twice during the last 27 years.

SAN JOSE
Financial Worries
It seems the Town Hall of San Antonio is not the only administration facing financial difficulties, as the Councillor for Planning, Josep Antoni Prats, admitted San Jose could face bankruptcy over the next few years. His comments came at a forum organised by ERC, the left-wing Catalonian party, which took place on the island on Monday. He explained that the Town Hall was currently being sued by a number of property developers who had had certain projects stopped since Prats’ PSOE-ExC party took over. He made particular reference to the promoters of the sa Caixota development, who are claiming €12 million in damages after certain restrictions were put in place. He reminded the audience that the annual budget of the Town Hall in 2009 was just €24 million, ensuring that when the cases eventually came up, if they were to lose they would find themselves in significant financial trouble. However, he remained confident the Town Hall would win all of the cases in question, claiming there were numerous ways to read many of the different municipal laws regarding building work, and that they had acted in good faith when restricting work in all cases.

SAN JUAN
Positive Response
The mayor of San Juan, Antoni Mari Carraca, revealed on Thursday that he had reached an initial agreement with the Education Department for the building of a new elementary school in San Lorenzo. The remarks came during a visit of the Balearic Minister for Education, Barbara Galmes, to the island. She was here to present the AENOR quality award to the Portmany secondary school in San Antonio, but most of the talk concentrated on her meeting with Carraca.
He later explained the construction of the new school was “a necessity” and that he would do everything in his power to make sure it went through. He continued that the Town Hall had offered the Ministry a 5,000 m2 plot of land for the construction, although the minister did not visit the proposed site on this trip. He said the school currently being used had originally been built in 1928 by the local population, and was, many years later, taken over by the Town Hall. He added there was now no room for any further expansion, and the only option remained a new building.

FORMENTERA
Car Ban
Since last week drivers will now be prohibited from parking their vehicles in la Savina port overnight. The measures were first introduced last year by the Port Authority, to considerable criticism. However, the Island Council has now given the green light to the proposals as they try to control the continuing parking problems in the area. At the moment the authorities are placing notes on windscreens, but this will change very soon, and fines of up to €90 will be handed out to cars caught in the parking lot from 11:00 p.m. through until 6:00 a.m.
The Council announced it had agreed to the moves as it believed it was the only way to stop cars being left at the port for several weeks, even months, by people visiting the island, which had ensured it was virtually impossible to find spaces during the day near the port area, which is the main entrance and exit to and from the island.
Curiously hire cars are already banned from using the car park, a regulation which will continue.

NEWS FROM THE MAINLAND
Russian Reversal
An embarrassing showdown between Russia and Spain was avoided on Tuesday after the head of the National Epidemiology Service, Gennady Onischenko, went back on her recommendation to avoid holidaying in Spain due to swine-flu.
"We continue to insist that our citizens not travel to the United States, Mexico and Canada. And from today we do not recommend travelling to Spain," she had originally told the Interfax agency. According to official figures in Spain there have been one hundred cases of "influenza A", less than those recorded in UK.
The first human case of swine flu in Europe was confirmed in Spain towards the end of April. Spain’s Health Minister, Trinidad Jimenez, revealed at the time a 23-year-old Spanish man, who recently returned from Mexico, had begun to show symptoms of the virus in Almansa, in southeast Spain. In quick succession another 20 other people were suspected of infection with the virus. However, the number of reported cases has since declined, which led to the reversal of Russia’s decision.
Meanwhile the country’s ban on Spanish pork products remained in place, despite being described as "unjustified" by a European Commission trade official.
"The European Commission regrets that the Russian competent authorities have taken unjustified measures which are in contradiction with internationally recognised guidelines," trade affairs spokesman, Guellner Lutz, said. "The commission is in contact with the Russian authorities to urge them to reconsider the measure currently applied and will keep the Russian authorities informed of any relevant development," he said.
The ban also extends to Canadian pork products.

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