Jailed Catalan independence leader strikes tone of compromise as election looms

The jailed leader of Catalonia's main pro-independence party has backed away from demands for unilateral secession from Spain, days ahead of regional elections that surveys suggest will produce a hung parliament.

The independence drive has tipped Spain into its worst political crisis since the return of democracy in the 1970s, dividing opinion and prompting a business exodus in the province and denting a rebound in the national economy.

Opinion polls predict secessionist parties in Catalonia, a former principality with its own language, face a tough task to regain power in Thursday's ballot, with neither the pro-independence nor the pro-unity camps tipped to win a parliamentary majority.

In reply to written Reuters questions passed to him in prison, Oriol Junqueras, whose Esquerra Republicana (Republican Left) party is expected to become the largest separatist force in parliament, struck a conciliatory tone.

Junqueras, who is in custody on allegations of rebellion and sedition, wrote that he would continue to pursue independence if he becomes Catalonia's next president, but also to "build bridges and shake hands" with the Spanish state.

"I can assure you that we are democrats before we are separatists and that the aim [of gaining independence] does not always justify the means," he said in comments that appear to drop his party's earlier demand for unilateral secession.

Junqueras was deputy leader of the Catalan government that was dismissed by Madrid in late October after the regional assembly declared unilateral independence from Spain. That followed an independence referendum on Oct. 1.

The assembly was also dissolved and fresh elections called.

Junqueras said if he was elected regional president he would pay heed to voters who opposed independence.

"I would tell them everybody has to be respected and that differences always have to be resolved in a democratic way," he said.

Turnout is expected to be high when polling stations open Thursday for 7.5 million voters in a region that accounts for 19 per cent of Spain's gross domestic product.

Tourism up, but not in Catalonia

A triumph for pro-independence parties could lead to further instability in Spain, which has the fourth-largest economy in the 19-country eurozone.

Citing the uncertainty over Catalonia, Spain's central bank on Friday cut its growth forecasts for next year and 2019 to 2.4 per cent and 2.1 per cent respectively, shaving a percentage point off its previous predictions.

Recent figures show Catalan retail sales and tourist arrivals are falling and unemployment is edging higher.

Just over 3,000 businesses have moved their official headquarters out of Catalonia in recent months, anxious they might no longer be covered by Spanish and European Union laws if Catalonia broke away. Those companies included Catalonia's top two banks, Caixabank and Sabadell, and Planeta, the world's leading Spanish-language publisher.

Retail sales in Catalonia fell almost four per cent in October compared with the same month last year, the steepest drop across Spain, the national statistics agency INE said.

Ousted Catalan leader Carles Puigdemont, a fugitive who is in Belgium, argues that Catalonia hands over too much tax revenue to the national government and would be better off going it alone. Puigdemont, who represents theJunts per Catalunya party (JuntsXCat), insisted in a recent newspaper interview that the Catalan economy is stable and noted that companies aren't moving their production out of the region.

Tourist arrivals in Catalonia, including its popular capital Barcelona, were 4.7 per cent down in October compared to last year's figures, according to INE. The drop occurred in a month in which visitor numbers nationally were 1.8 per cent higher..

Meanwhile, Catalonia this year witnessed its biggest November jump in unemployment in eight years, though the increase was a relatively modest 7,400 people and the jobless rate also increased in nine other autonomous regions.