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02.08 - Spain Today News 19 July 2025 · Spain Today - Last Spanish News

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Welcome back everyone. To the deep dive, it really is
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great to be back, we know. What it's been a.
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Couple of weeks, things got a bit hectic, moving offices and
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all that, but the good. News is we're.
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All settled in, the new setup is great and we are absolutely back
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on track and ready to dive deep into some, well, really
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fascinating stories coming out of Spain recently.
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Our mission today, like always, is to come through all that
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noise, you know, pull out the crucial bits from a whole stack
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of recent sources and hopefully hand you the surprising facts,
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the actionable insights, so you feel truly well informed.
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Absolutely. And we definitely have a lot to
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get through today, things that really paint a clearer picture
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of what's happening in Spain right now.
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We're going to look at three main areas.
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First up, there's this really complex 7 year investigation.
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It's about alleged legislative influence, involves a former
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finance minister, pretty big stuff.
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Then we'll switch gears to something very immediate the the
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challenges Spain's facing with these widespread wildfires.
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It's critical, ongoing. And finally, something maybe a
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bit unexpected, a really interesting surge in the Spanish
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mortgage market. And like you said, these aren't
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just quick headlines. There are intricate details,
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broader implications we really want to unpack for you.
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OK, let's start with that first one.
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Then. We're diving deep into, well,
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the shadows of Spanish politics. You could say it's this
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seven-year saga. Honestly, it reads like a
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political thriller, and it centers on the man who, you
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know, once held the nation's purse strings, the former
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finance minister Cristobal Montoro.
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It is genuinely a complex investigation, but the core
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question it throws up is, well, it's profound, really.
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What actually happens when that line between private interest
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and public policy gets blurry? Well, according to the
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reporting, particularly from RTVE and the judge's findings,
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the whole thing seems to pivot on one single e-mail.
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An e-mail they found back in 2017.
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It was between 2 senior execs at a gas company, Messeri Baraka,
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Ruben Fulgado and Carl Hotdog. And what were they talking
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about? Basically, how to directly
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influence the Congress of Deputies, the Spanish
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parliament, to get a law changed for some pretty big tax
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benefits. And the really shocking part is
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this direct quote from that e-mail.
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The date. Of December 5th, 2013, it says.
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La via mas. Director como siempre espagara
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este equipo economico que tiene contacto director con El
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ministro de Hacienda Cristobal Montoro.
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Now, for anyone not up on their Spanish, that translates roughly
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to 2F, the most direct. Way as always.
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Is to pay this economic team that has direct contact with the
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Minister of Finance. Cristobal Montoro.
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And the judge, well, the judge looking at this, interpreted
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that phrase. Especially.
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The as always. Part.
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So you have the paying equipo economico?
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Montaro's firm. Well, it could have been
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something habitual, unknown. That, as always, is pretty
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telling. Isn't.
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It it really is. And understanding equipo
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economico is absolutely critical here.
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Montaro himself founded it, that's confirmed, and other
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high-ranking officials from the ministry were explicitly linked
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to it too. Reports from the Mossos de
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Squadra, that's the Catalan police force.
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They alleged the firm had this great capacity to basically
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connect companies straight to the Ministry of Hacienda and not
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just connect but exert influence over the whole legislative
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process. They even suggested it led to
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patronals, you know, these powerful industry associations
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actively participating and actually drafting laws.
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Well, OK, so if the firm allegedly had that kind of sway,
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how did it work in practice? Do we have like concrete
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examples of this? This legislative molding.
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Yeah, absolutely. There's one really compelling
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example that involves the Association of Manufacturers of
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Industrial and Medicinal Gases, AF Gym.
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They were lobbying hard for an 85% reduction on their
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electricity tax. And the sources indicate that
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the legislative text they proposed, well, it was quote,
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completely adapted to their needs.
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Just think about that for a second.
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A private industry group allegedly writing legislation
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specifically for their own benefit and then seeing that
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text become public law, that is quite a claim.
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Was there another big instance where this supposed influence
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showed up? Yes, definitely.
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Another key example popped up with the reduction of the tax on
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economic activities, the IAE, in the 2018 general budgets.
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Now initially the guy in charge, Oscar Alamogalam, the sub
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director general of local taxes, he actually resisted this
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reform. He pushed back, but after
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Montoro appointed Alberto Garcia Varela, who had links to the
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consulting firm EY as the director of Tributos in 2016,
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well, things changed. The Lomo Golan apparently
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restarted contacts with the gas patronal.
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And what's more, he then accepted aft Jim's own draft of
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the reform, knowing full well their members would benefit.
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And just adding another layer here, Rogelio Menendez, an
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advisor to the minister who was actually at a meeting between
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Montoro and this gas patronal. He was recently fired by
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Hacienda. The sequence of events, it
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paints a very specific picture. So broadening this out a bit,
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the judge overseeing this, Ruben Rasvella from the court in
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Tarragona, he describes Equipo Economico as a company that, and
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I'm quoting here, mediating Price, would dedicate itself to
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intervening in the legislative process, molding legal reforms
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to the needs of its clients. That was, that's a very specific
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and frankly damning description of what they were allegedly up
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to. It is, and it naturally leads to
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the question, was this just about the gas sector or was it
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wider? The Youco, that's the central
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operative unit of the Civil Guard.
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They actually warned this could have happened with other
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companies of different sectors. They even mentioned names like
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Madrid Network for Ovial A Bengowa.
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That was fair to say. These came from an anonymous
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complaint that was later archived.
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But still the investigation judge also noted this temporal
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coincidence. Basically new laws appearing
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with tax breaks for the electrical and renewable energy
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sectors right around the same time as payments were made by
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companies in those sectors to a studios economic host, right.
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So after seven years, 18 volumes of investigation.
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What's the big take away? What?
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Are we really looking at here? Well, the really striking thing
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after all this time isn't just, you know, 1 alleged crime, it's
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the incredibly detailed picture that emerges.
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A picture of a sophisticated, almost you could say menu driven
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system where private companies allegedly paid to have public
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laws crafted just for them. The shock isn't just if it
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happened, but the sheer apparent brazenness.
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Phrases like paying this economic team and a firm molding
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legal reforms. I mean, the anti corruption
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prosecutor's office, they've identified a whole range of
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possible crimes, 12 of them, everything from prevarication,
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fraud against the public administration, influence
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peddling, illicit negotiations, embezzlement, money laundering,
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business corruption, even belonging to a criminal
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organization. It really highlights a deep
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potential vulnerability in how democratic laws get made laid
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bare in a way you rarely see. OK, quite a story.
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And Speaking of major challenges, Spain's facing a
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very different, much more visible battle right now.
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He's devastating wildfires that are sweeping across parts of the
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country. It's become a critical and sadly
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ongoing national issue. That's right.
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As of when our sources were reporting 2 new significant
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fires, level 2 fires had been declared, one in EB in Alicante
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and another in Navaluenga in Avila.
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There is some slightly better news, a separate big fire in
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Mantrita, Toledo that bring I think over 3200 hectares.
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That one's now under control. But yeah, it just underscores
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the scale of the problem they're facing.
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Let's zoom in on that EB fire in Alicante.
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First, it started near the Font Rocha Natural Park, which is
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famous locally, right? A real green lung for the area
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and the initial efforts, understandably, we're all about
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protecting that park. But sadly, the reports say the
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flames have now reached it. Yes, it started in the San
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Pasqual area, affecting both EV and Alcoa municipalities, and
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it's already burned over 250 hectares.
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Though that's a provisional figure, it could rise and the
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response must be huge. Oh, absolutely massive.
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We're talking over 200 people on the ground.
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That includes 60 soldiers from the UME the military emergency
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unit. Plus, you've got the general
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attack, Valenciano's force brigades, multiple firefighter
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units from both and Valencia provinces.
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But the conditions they're working in are just incredibly
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tough. Warm winds hitting 40 kilometers
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per hour, temperatures up near 37 Celsius, and crucially,
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extremely low humidity down at 11 percent.
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That combination just makes getting control incredibly
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difficult, you can imagine. And the impact on nearby areas,
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intense smoke, reports of an orange sky in nearby towns.
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They've done some precautionary evacuations too, and advise
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residents nearby to stay inside, keep windows shut.
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Apparently the fire initially broke out near religious
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community residents. El Sinaculo is still being
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looked into. Exactly.
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And it's important to stress the entire Valencian community is
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currently under extreme risk for forest fires over the next few
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days because of these conditions.
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What's really sobering about this is how these massive fires
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are becoming this tragic, almost annual staple.
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It's forcing Spain to pour resources not just into fighting
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them, but into completely rethinking Land Management,
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forestry, everything really, in the face of climate change.
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Yeah, huge challenge. And the other big one in
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Navaluenga Avila, right? That one's in a natural spot
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called La Chinita. It also hit that level 2
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potential severity index, which basically means it poses a
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serious threat to people or property, triggering significant
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public safety measures. As a precaution, they evacuated
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about 20 homes in an area called the El Cajigo.
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Urbanization, OK. And the response effort there,
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similar scale, also very significant.
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Over 50 units involved both air and ground support, including
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the ume again, this time deployed from Torahonda Ardos
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near Madrid. The mayor of Nevaluenga actually
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said the fire apparently started near some cattle sheds.
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He mentioned that while it did surround the village itself, the
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cordon they put up around the village is now controlled.
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And he pointed out one bit of, well, luck.
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As he put it, it's mostly burning low scrub and meadows,
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which is generally more manageable to fight than dense
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forest. Still sounds incredibly
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challenging though. Yeah.
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What are the conditions like in Avila?
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Still very tough. Winds around 26 kilometers per
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hour, but with gusts up to 47. Temperatures 33 Celsius and
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again, very low humidity 13%. The regional government, the
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junta, they've asked drivers to stay clear of nearby roads,
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obviously to help the firefighting efforts.
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Their main priority is protecting the nearby towns,
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places like Burka Hondo, Nava Livenga itself, Nava Moral, Sano
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de la Nava and the mayor of Burgah.
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Hondo did confirm the fire reached the edge of their town
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quite quickly, but thankfully it's now controlled there with
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no major damage reported yet. It's just incredible isn't it?
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The scale of these events, the coordination needed, the sheer
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bravery involved in tackling them.
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It feels like this relentless battle every year where natures
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power gets amplified by these shifting weather patterns
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turning beautiful. Parks into well.
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Battlegrounds. OK, so from the long burning
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embers of those political allegations and the literal
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flames across the landscape, let's pivot.
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Now let's turn to something surprisingly dynamic happening
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within Spain's economy. There's this really fascinating
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surge going on in the housing market.
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Yes, the headline data here is genuinely quite striking.
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The number of mortgages signed on homes, it just skyrocketed,
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up 54.4% in May 2025 compared to May last year.
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That totals 42,274 contracts, which isn't just a small jump,
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it's actually the biggest increase they've seen since
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October 2024, the best May figure since 2022, and it marks
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11 consecutive months now of year on year increases.
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It's quite a street, 11 months straight.
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OK, that's impressive, but it's probably worth putting that in
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perspective, right? We're still talking numbers that
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are a long way off the, you know, the crazy peaks of Spain's
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housing bubble back when they were seeing over 100,000
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signings a month. Oh, absolutely.
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Good point. We're nowhere near those kinds
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of levels, but the trend is definitely notable.
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And here's another really intriguing detail.
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The average amount of these mortgages also went up quite a
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bit by 12.7 percent, 258,153, and that seems to be driven
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largely by rising house prices themselves, which by the way,
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jumped 8.4% in 2024. That's a rate we haven't seen
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since way back in 2007. Wait a second.
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Did you say the average mortgage amount?
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158,153 in May 2025? That's the highest since
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February 2020, before the pandemic really hit.
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And you're saying it's even higher than average amount seen
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during the bubble years? That feels what's significant,
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what's going on there? It is significant.
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It really suggests a market that's responding very strongly
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to the current interest rate environment because the main
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driver, the core force behind this whole surge, it really
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seems to be falling interest rates.
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No doubt about it. The average interest rate for
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these new loans dropped to 2.91%.
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That's the lowest it's been since February 2023.
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And importantly, rates have now stayed below that 3% mark for
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four months running after nearly two years of being above it.
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Just compare that to May 2024 when the average rate was 3.25%.
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That drop is clearly unlocked a lot of demand.
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OK, so falling rates are key. And what type of mortgages are
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people actually choosing? Is there a trend there?
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Oh, absolutely. And this is where it gets really
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interesting. I think there's an overwhelming
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preference for fixed rate mortgages.
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We're talking 7 out of 10 new borrowers.
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That's 69.9% choosing fixed rates.
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And they're doing this even though variable rates, currently
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around 2.78%, are actually slightly lower than the average
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fixed rate, which is about 2.97%.
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Both are below 3%, but people are still flocking to fixed.
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So. Even with variable rates being a
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tiny bit cheaper right now, people are overwhelmingly
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locking in fixed rates. What does that tell us about
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maybe buyer sentiment or psychology?
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I think it tells us a lot. It's really a fascinating
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insight into how buyers are thinking, probably driven by
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recent history, right? The really striking take away
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from this whole mortgage boom isn't just the sheer number of
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deals being done, it's the very clear message Spanish homebuyers
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seem to be sending. Interest rate stability is
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absolutely paramount for them, this massive shift towards fixed
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rates, even when variables are technically cheaper.
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It suggests A collective memory of past economic volatility and
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a really strong desire to lock in some certainty, some
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predictability, especially in what feels like a pretty
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unpredictable global economy right now.
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That makes sense. And what about people
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negotiating existing mortgages? Are lower rates encouraging a
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lot of that? Well, you think so.
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With the European Central Bank cutting rates, it definitely
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encourages people to look into it.
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But interestingly, the actual number of modified contracts
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people renegotiating it actually decreased by 15.4% year over
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year in May. Still, you know, over 11,000
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contracts were modified, 11,258 to be exact.
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And the most popular way to do it was Novation, basically
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tweaking the terms but staying with the same bank that
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accounted for almost 9 thousand of them.
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Other methods like subrogations where you actually change the
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title holder or switch banks entirely, those were less common
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but still happening. OK, interesting nuance there.
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And just to round out the picture geographically, was this
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surge happening everywhere in Spain?
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Pretty much, yeah. All the autonomous communities
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saw increases in mortgage signings, but some regions
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really stood out. Galicia saw a massive surge, up
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116%. La Rioja was up 100%, basically
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doubled. Cantabria saw a 92.8% increase.
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Even regions with more modest increases still saw significant
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growth, like Catalonia, which was up nearly 31%.
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So it was widespread. So putting this piece into the
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bigger picture of the Spanish economy, what does it all mean?
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And maybe more importantly for you listening, if you're perhaps
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considering buying a home in Spain or maybe refinancing, what
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are the implications? It certainly suggests a market
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that's found well renewed energy driven by these more accessible
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interest rates. And as we discussed that very
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strong desire among buyers for long term financial
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predictability, right. Bringing it all together then,
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today we've really dug into quite a range of topics, from
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those ongoing revelations of the Montoro investigation, the
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complex allegations of legislative influence, then
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shifting to the. Huge resilience, but also.
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The immense challenges involved in battling those wildfires
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across Spain and finally exploring this really dynamic,
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clearly rate driven shift happening right now in the
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Spanish mortgage market. Yeah.
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And I think it shows how crucial it is to look beyond just the
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surface headlines, doesn't it? Understanding these more
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intricate details, the context, it really does offer a much
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clearer, more comprehensive view of what's actually going on in
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Spain. And you see the connections to
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economic policy influencing housing, climate change
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impacting daily life and safety. It all shapes the reality for
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millions of people. Absolutely.
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And maybe just one final provocative thought for you, the
16:09
listener to Shuan. Given that incredibly clear
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preference we saw for fixed rate mortgages in Spain, even when
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variable rates are slightly lower and thinking about the
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lessons learned from past housing market booms and busts,
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what does that widespread choice really tell us about the
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public's confidence or perhaps their lack of confidence in the
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future stability of interest rates and maybe even the broader
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economy? Definitely something worth
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mulling over. Thank you so much for joining us
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for this deep dive into the latest from Spain.
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We really appreciate you tuning in.
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We'll be back soon with more.