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LIFE IN SPAIN

Everything that changes about life in Spain in August 2021

August may traditionally be a slow month in Spain when not much happens, but this year there are lots of important changes affecting everything from travel, to living costs, official documents, Covid rules and more.

Published: 29 July 2021 18:15 CEST
Updated: 4 August 2021 11:37 CEST
Everything that changes about life in Spain in August 2021
There are many changes to daily life in Spain expected for August 2021. Photos: Spanish Interior Ministry, AFP, ESO

Have we reached the peak?

On July 29th, Spain’s fortnightly infection rate didn’t rise for the first time in over a month, going from 702 cases per 100,000 on Wednesday to 699 on Thursday. 

However, it may still be too early to assume that the country has reached the peak of infections of its fifth coronavirus wave. 

In fact, the ECDC forecasted on July 16th that Spain would reach an infection rate of 2,400 cases per 100,000 in the first week of August. 

That seems like an even more unlikely scenario, especially as the country’s regions have tightened restrictions to curb infections and the national vaccination campaign is advancing at a considerable speed.

A summer month marked by restrictions 

Spain’s 17 autonomous communities have each tightened their own set of Covid measures, which will remain in place for at least part of August.

The Valencia region will have a night-time curfew until August 16th in 77 municipalities with high infection rates (including Valencia and Benidorm) and Catalonia also has a similar curfew in place. 

The Balearics are limiting gatherings between people who don’t live together and other regions such as the Canary Islands are closing their bars and restaurants early.

You can find out more about the restrictions currently in place in each region in the link below, but it’s safe to say that August will be the summer month with the strictest Covid measures following eased restrictions in June after the fourth wave. 

READ ALSO:

Herd immunity through vaccination in August?

Spain met its target of 25 million people fully vaccinated in July and currently has a higher rate of full inoculation that all other large countries, including the US, the UK, France and Germany. 

Back in April, Prime Minister Pedro Sánchez set the target of reaching 70 percent full immunity among Spain’s 47 million inhabitants “by late August”, a target which looks feasible at the current rate.

Seventy percent is widely quoted by virologists as the target that has to be met to reach herd immunity, although Spain is aiming for 100 percent and even a third “reinforcement” vaccine. 

Although there are regional differences, in late July people in their forties and thirties were receiving their second dose while younger age groups were getting their first jab. 

Spain’s Health Ministry announced on July 21st that Moderna and Pfizer vaccine deliveries would continue to arrive in their hundreds of thousands every week in August and that supplies of single-dose Johnson & Johnson vaccines will be bolstered.

READ ALSO:

Uncertain travel 

It’s no surprise around 80 percent of people in Spain are choosing to spend their summer holidays in their country of residence. 

The US has banned non-US citizens in Spain from travelling to the country and the State Department has added Spain to its ‘do not travel’ advisory list, which we’ve explained in more detail here.

The UK is set to make it slightly easier for vaccinated Brits in Spain to travel back home without quarantining, but by the time the UK government’s updated travel restrictions is published on August 4th or 5th, Spain or some of its regions may be moved to the so-called amber plus list France is currently on. 

Germany has also reclassified Spain as a high-incidence area, affecting another of Spain’s main tourism markets.

So even though Spain is keeping its borders open (some restrictions but few travel bans or quarantine requirements), other countries are watching Spain’s high infection rate closely and tightening travel for those flying back from the country.

READ ALSO:

800 bank branches to close during August

If you have an account with Caixabank, BBVA or Sabadell, keep in mind that your local branch may be closed during the month of August. 

Caixabank will close 50 offices during Spain’s traditional summer holiday month, BBVA will pull down the shutters on 469 branches and Sabadell will temporarily close 288 branches. 

It’s worth noting that hundreds of bank branches are closing all together in Spain in 2021, so in some cases the August closures may be permanent.  

(Photos by GABRIEL BOUYS and Josep LAGO / AFP)

Easier way to find cheaper electricity rates in Spain

Electricity prices have reached historic highs during July but there is a change being introduced in August that could at least help consumers know if there are better rates out there.

Right at the end of the month on August 31st, most electricity bills in Spain will start to include a QR code that will take users to the live price comparison page of Spain’s National Commission of Markets and Competition (CNMC).

This will make it easier for consumers to see whether they can pay less for gas and electricity, as well as being a more hassle-free way to keep tabs on other parameters relating to their consumption and bill. 

Spain to extend property moratoriums past August

The Spanish government on July 29th extended the protection measures for tenants and homeowners who are struggling to pay their rents or bills as a result of the coronavirus crisis. 

The exemptions were meant to end on August 9th but  have now been extended until October 31st 2021.

Until then, all evictions in Spain are suspended, homeowners can request an extra three-month moratorium on their mortgages, vulnerable tenants can apply for the delayed payment of their rent and gas, electricity and water cannot be cut off due to non-payment of bills. 

New ID for Spanish nationals 

For our readers who are Spanish nationals or looking to gain Spanish citizenship soon, a new ID card (DNI) will be launched on August 2nd.

It’s an electronic ID with a microchip that contains more information about the owner as well as greater details on the card (holograms and microtexts) to make it harder to forge.

The new DNI also includes the Spanish national’s details in both English and Spanish, it has a bigger photo and it can be displayed digitally on the user’s mobile device through an app.

new id document spain

One of the other benefits is that this new ID can be expedited very quickly: the applicant simply goes into a photobooth at the migration office, pays there and then by card rather than at the bank and gets the card immediately.

The reason for this update of Spain’s main identification document is that the EU has been pushing for all member states to issue ID documents with common attributes to facilitate travel and other processes.

Spain to start receiving EU recovery funds

Spain will receive the first €19 billion of the €140 billion (€70 billion of direct aid, the other half in loans) it is set to receive from the EU as part of its plans to get Europe back on its feet after the economic crisis caused by Covid-19.

Among the projects the Spanish government will fund are the plans to provide direct subsidies for the purchase of electric cars and tax deductions for people to make green home improvements. 

READ ALSO: The home improvements you can get a 60 percent tax deduction for in Spain

Starry night displays on show in August

The Perseids, also referred to as the Tears of San Lorenzo, is one of the most important astronomical events of the month of August in Spain and around the world. 

These meteor showers reach their peak on the night of August 11th just at around 11.45pm, so try to be in a rural location with little light pollution on that day, or find out if there are astronomical observatories holding any sightings. 

(Photo by MENAHEM KAHANA / AFP)

Crowds can return to Spanish stadiums

The 2021/2022 edition of La Liga kicks off on August 13th, also marking the return of 75 percent of the fans for the first time in a year and a half. 

However, the Spanish government authorised the increased capacity of football, basketball, tennis and other sport stadiums in June before the fifth wave of the coronavirus took hold of Spain. 

This could mean that the stands may end up not being quite as full as expected, especially if Spain’s infection rate remains high during the first two weeks of August. 

New law for delivery riders comes into force

Back in May, Spain’s cabinet approved a labour law reform that recognises delivery riders working for firms such as Deliveroo or UberEats as staff, a first in the European Union.

The law comes into force on August 12th, meaning delivery companies have to make sure their riders have an official work contract and all the benefits it brings before that date. 

READ ALSO: Delivery riders become company staff as Spain’s labour reform approved

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MONEY

Rampant branch closures and job cuts help Spain’s banks post huge earnings

Spain’s biggest banks this week reported huge profits in 2021 and cheered their return to recovery post-Covid, but ruthless cost-cutting in the form of thousands of layoffs, hundreds of branch closures and the removal of many ATMs have left customers in Spain suffering, in this latest example of ‘Capitalismo 2.0’. 

Published: 3 February 2022 13:34 CET
A man withdraws cash from a Santander branch in Madrid.
More than 3,500 Santander workers lost their jobs in Spain in 2021 and a further 2,000 more employees working for Santander across Europe were also laid off. Photo: PHILIPPE DESMAZES / AFP

Spanish banking giant Santander on Wednesday said it has bounced back from the pandemic as it returned to profit last year, beating analyst expectations and exceeding its pre-COVID earnings.

Likewise, Spain’s second-largest bank BBVA said on Thursday that it saw a strong rebound in 2021 following the Covid crisis, tripling its net profits thanks to a recovery in business activity.

It’s a similar story for Unicaja (€137 million profit in 2021), Caixabank (€5.2 billion profit thanks to merge with Bankia), Sabadell (€530 million profit last year), Abanca (€323 million profit) and all of Spain’s other main banks.

This may be promising news for Spain’s banking sector, but their profits have come at a cost for many of their employees and customers. 

In 2021, 19,000 bank employees lost their jobs, almost all through state-approved ERE layoffs, meant for companies struggling financially.

BBVA employees protest against layoffs in May 2021 in Madrid. Spain’s second-largest bank BBVA is looking to shed 3,800 jobs, affecting 16 percent of its staff, in a move denounced by unions as “scandalous”. (Photo by GABRIEL BOUYS / AFP)

Around 11 percent of bank branches in Spain have also been closed down in 2021 as part of Spanish banks’ attempts to cut costs, even though they’ve agreed to pay just under €5 billion in compensation.

Rampant branch closures have in turn resulted in 2,200 ATMs being removed since the Covid-19 pandemic began, even though the use of cajeros automáticos went up by 20 percent in 2021.

There are now 48,300 ATMs in Spain, levels not seen since 2001.

READ MORE:

Apart from losses caused by the coronavirus crisis, Spain’s financial institutions have justified the lay-offs, branch closures and ATM removals under the premise that there was already a shift to online banking taking place among customers. 

But the problem has been around for longer in a country with stark population differences between the cities and so-called ‘Empty Spain’, with rural communities and elderly people bearing the brunt of it. 

 

Caixabank laid off almost 6,500 workers in the first sixth months of 2021. Photo: ANDER GILLENEA/AFP

Just this month, a 78-year-old Valencian man has than collected 400,000+ signatures in an online petition calling for Spanish banks to offer face-to-face customer service that’s “humane” to elderly people, spurring the Bank of Spain and even Spain’s Prime Minister Pedro Sánchez to publicly say they would address the problem.

READ MORE: ‘I’m old, not stupid’ – How one Spanish senior is demanding face-to-face bank service

It’s worth noting that between 2008 and 2019, Spain had the highest number of branch closures and bank job cuts in Europe, with 48 percent of its branches shuttered compared with a bloc-wide average of 31 percent.

Below is more detailed information on how Santander and BBVA, Spain’s two biggest banks, have reported their huge profits in 2021.

Santander

Driven by a strong performance in the United States and Britain, the bank booked a net profit of €8.1 billion in 2021, close to a 12-year high. 

It was a huge improvement from 2020 when the pandemic hit and the bank suffered a net loss of €8.7 billion after it was forced to write down the value of several of its branches, particularly in the UK. It was also higher than 2019, when the bank posted a net profit of €6.5 billion.

Analysts from FactSet were expecting profits of €7.9 billion. 

“Our 2021 results demonstrate once again the value of our scale and presence across both developed and developing markets, with attributable profit 25 per cent higher than pre-COVID levels in 2019,” said chief executive Ana Botin in a statement.

Net banking income, the equivalent to turnover, also increased, reaching €33.4 billion, compared to €31.9 billion in 2020. This dynamic was made possible by a strong increase in customer numbers, with the group now counting almost 153 million customers worldwide. 

“We have added five million new customers in the last 12 months alone,” said Botin.

Santander performed particularly well in Europe and North America, with profits doubling in constant euros compared to 2020. In the UK, where Santander has a strong presence, current profit even “quadrupled” over the same period to €1.6 billion.

Last year’s net loss was the first in Banco Santander’s history, after having to revise downwards the value of several of its subsidiaries, notably in the UK, because of COVID.

The banking giant, which cut nearly 3,500 jobs at the end of 2020, in September announced an interim shareholder payout of €1.7 billion for its 2021 results. “In the coming weeks, we will announce additional compensation linked to the 2021 results,” it said.

BBVA

The group, which mainly operates in Spain but also in Latin America, Mexico and Turkey, posted profits of €4.65 billion ($5.25 billion), up from €1.3 billion a year earlier.

The result, which followed a solid fourth quarter with profits of €1.34 billion, was higher than expected, with FactSet analysts expecting a figure of €4.32 billion .

Excluding non-recurring items, such as the outcome of a restructuring plan launched last year, it generated profits of 5.07 billion euros in what was the highest figure “in 10 years”, the bank said in a statement.

In 2020, the Spanish bank saw its net profit tumble 63 percent as a result of asset depreciation and provisions taken against an increase in bad loans due to the economic fallout of the virus crisis.

“The economic recovery over the past year has brought with it a marked upturn in banking activity, mainly in the loan portfolio,” the bank explained, pointing to a reduction of the provisions put in place because of Covid.

In 2021, BBVA added a “record” 8.7 million new customers, largely due to the growth of its online activities. It now has 81.7 million customers worldwide.

The group’s net interest margins also rose 6.1 percent year-on-year to €14.7 billion, said the bank, which is undergoing a cost-cutting drive.

So far, it has axed 2,935 jobs and closed down 480 branches as the banking sector undergoes increasing digitalisation and fewer and fewer transactions are carried out over the counter.

At the end of 2020, BBVA sold its US unit to PNC Financial Services for nearly 10 billion euros and decided to reinvest some of the funds in the Turkish market.

In November, it launched a bid to take full control of its Turkish lending subsidiary Garanti, offering €2.25 billion ($2.6 billion) to buy the 50.15 percent stake it does not yet own.

The deal should be finalised in the first quarter of 2022.

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