Hola my friend. How are you?
I want to keep an eye on my parents who live in Fuerteventura (Islas
Canarias) because of the economic crisis that is coming. I left the
Island 4 years ago when things started getting pretty bad with regards
to employment and i could see the price rises in everyday products.
Now my parents have taken all their savings out of Santander and put
it into Solbank and Bancaja. I try to keep track of things going on
over there but could you give me any advice on what dangers to look
out for please? Just so i can warn my parents,sister and friends
living on the Island....muchas gracias mi amigo
In your case Canaria has a nice amount of infrastructure but you’re still talking about islands that are 30km wide, strongly dependent on outside help for resupply and has little water. The closes mainland you have is Western Sahara desert, 100km to the coast. Basically you need a plane to get out of there or a boat doing 800 km to Cadiz in Spain.
On the plus side you’re also pretty isolated which in some cases can be good (think global pandemic, war) but even in those cases the dependence on exterior supplies to get by and especially being so far away from it is why in most cases, islands are not recommended from a strategic point of view. Granted, I’m in an island myself, but its much bigger, it has a good amount of food production and the largest lake in all UK, lots of rain, and you can literally see England across the Irish sea.
More relevant to what’s going on today, the distance means that most of what you need will have the added cost, and giving the global economic context you’re seeing at transportation costs going up, and those passing on to the products. In Fuerteventura you also have arid climate, and combined with the lack of water and depending on desalination plants, that’s a considerable weakness. Islas Canarias is of volcanic origin and there’s been recent volcanic and sismic activity as well. From a strategic point of view, its really not the best place to be in.
In spite of all this, its a beautiful place to live in. How can you put a price on the natural beauty and peace you gain form living there? When stress, overweight and clinical depression affects such a large percentage of the population the strategic geographic disadvantage becomes almost anecdotal compared to the increase in life quality. If your parents are happy there and have the financial assets to deal with the unavoidable increase in cost of living eventually, then it makes sense to live there. I would still accept the weaknesses and disadvantages mentioned and plan accordingly as best as possible. I´m talking about having plenty of extra water, food and other supplies in case there´s transportation problems, and having plans for a quick evacuation if its ever needed. A well put together Go-Bag with money, documents, food, water, spare set of clothes and survival kit is a must have.
As you mentioned, unemployment and inflation hit places like that hard, mostly because of the isolation and because it depends a lot on tourism (75% of its economy) and tourism is clearly affected during recessions. For a young person, it would be hard to find many reasons to stay there. For someone that is retired or about to do so and has the money to live there, then it’s a different story.
About banks, if they want their money protected from an eventual corralito in Spain, the money has to be out of the country entirely, one bank or another within Spain and its regions makes no difference.
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