If you are going to invest in the Canary Islands, analyze the city well: Santa Cruz offers more facilities than Las Palmas

If you are going to invest in the Canary Islands, analyze the city well: Santa Cruz offers more facilities than Las Palmas

Analysis of economic freedom in 50 Spanish municipalities

Interventionism and fiscal pressure distance the two island capitals. Santa Cruz de Tenerife is the Spanish city with the greatest economic freedom while Las Palmas de Gran Canaria is 12 points behind

Silvia Fernandez

Doing business in the Canary Islands is not easy. It never has been. The different levels of the existing administration together with the proliferation of regulations force us to go around in circles that end up discouraging and tiring the investor. However,
Starting a business in the capital of Gran Canaria is not the same as in Santa Cruz de Tenerife or La Laguna, as revealed yesterday by the Index of Economic Freedom of Spanish Cities ILECE 2023prepared by the Foundation for the Advancement of Freedom and which analyzes the ease or difficulty of investing in the 50 largest Spanish municipalities.

The report points out that
Santa Cruz de Tenerife is the city in Spain with the most economic freedom and easier to invest. La Laguna follows at number 7 while
Las Palmas de Gran Canaria falls in the table to 30. Twelve points separate the two island capitals. The first gets a note of 68.45 out of one hundred, and places it at a "satisfactory" level while the capital of Gran Canaria gets 56 points and its level is "moderate". According to the study, among other things, Las Palmas de Gran Canaria is placed in the middle of the table due in part to the
slow to pay companies.

The study has evaluated four variables and in all of them the results are worse in the capital of Gran Canaria than in Santa Cruz de Tenerife. The greatest difference is in the tax burden: the tax burden in Las Palmas de Gran Canaria results in a difference of eight points. There is also a wide separation when it comes to analyzing municipal interventionism as well as economic performance. The greatest parallelism between the two municipalities occurs in the magnitude of the squads, where the score they obtain is similar.

It should be noted that the three Canary Islands municipalities improve their position but the authors of the study highlight the good evolution of
Santa Cruz de Tenerife, which since 2018 has improved its position by ten points. "Your good score is due to a public workforce and a downward tax burden," while advising you "reduce your costs, outsource services and lower taxes."

As to
Las Palmas de Gran Canaria, the analysis shows that "all the indicators can be improved»and points to the number of public companies and the slowness of payments as the most damaging. "Improving the IAE coefficients and lowering the IBI are measures that can help you and consolidate you in your new category," indicates the study, which recommends keeping this city under observation in 2024.

«General opacity and cumbersome and unclear information»

The authors of the study denounce the "general opacity" of many city councils when it comes to providing the information, since it is often "cumbersome and distributed with little clarity." As they complain in the report, the poor quality of the information provided sometimes forces, for example, complex data aggregations between different budget chapters to find comparable totals with those of other cities, in order to assign scores in various indicators. "Real transparency and rigor in the information is a pending issue for many municipalities", indicate the authors, who ensure that just as Spain occupies "a place that could be improved" in economic freedom, the 50 municipalities analyzed, too.