MADRID — Barcelona retailers are bracing for losses of up to 25 percent this week as increasingly violent protests hit major shopping and tourism spots, erasing gains from otherwise healthy sales from Spain’s strong economy.
“Luxury shops and stores in the center [Central Barcelona] will probably see losses of 20 percent to 25 percent this week, also as tomorrow [Friday] we will be closed for a major demonstration,” said Luis Sanz, president of the Associació del Passeig de Gràcia, which supports merchants in the city’s main upmarket shopping street, Passeig de Gràcia.
The area is home to some 50 luxury retailers, including Louis Vuitton, Chanel, Hermès and Burberry, and most recently Isabel Marant. It is also the location of many of the city’s top hotels, which have said the protests have hit bookings, with reservations falling by as much as 80 percent.
The upheaval began Monday following the jailing of nine separatist leaders for up to 13 years in the Barcelona home province of Catalonia. Spain’s Supreme Court charged them with alleged crimes of sedition, misuse of public funds and disobedience for orchestrating an illegal referendum in 2017 to break away from Spain.
The riots resulted in hundreds of people being injured and will see a negative short-term effect on sales, particularly for tax-free purchases made by visitors, Sanz said. Merchants at Passeig de Gràcia and around Barcelona account for 60 percent of such purchases in Catalonia and 30 percent in Spain, potentially worth more than $1 billion annually, according to Sanz.
Tuesday’s protests saw some of those businesses hit, though not directly, as the riots mainly took place after nightfall, Sanz said.
Rioters have also spared most stores so far from damage, unlike France’s yellow vest movement, which has seen protesters break windows of major stores and other businesses in central Paris since last year.
Meanwhile, turmoil in Barcelona hit new heights on Wednesday when rioters stormed the key Gran Via and other main thoroughfares late in the evening, staging the most violent clashes with authorities seen so far. They hurtled petrol and acid bombs against police and burned cars and garbage containers. Footage showed the demonstrators firing at a police helicopter and nearly burning a major gas station.
Sanz said the rising violence has forced many tourists to exit Barcelona or cancel trips, also as the El Pratt Airport was besieged with demonstrators on Monday, triggering the cancellation of hundreds of flights.
“We are in a state of shock,” he said about merchants’ moods, adding that if the protests persist, the city could see heightened losses as more tourists leave, spooked by the growing unrest.
Sanz expressed optimism that the situation — which is dividing Spain and prompting new calls for Catalonian elections or a new independence referendum — could be resolved soon, although the Spanish government’s refusal to issue a pardon to the separatist leaders has cast doubts for a quick truce.
A spokeswoman for Barcelona Oberta, which also represents retailers and merchants in Spain’s second-largest city, agreed the riots have become a major concern and that they could scupper 2019’s sales, which were running 3 percent higher than 2018 before the sentences against the Catalan politicians.
Still, she noted Spanish merchants are beginning to suffer from deepening uncertainty and the possibility of a global recession.
“We were expecting better sales this year,” said the spokeswoman. “People are not buying that much. There are too many voices about a recession.”
Meanwhile, Isabel Marant’s new shop in Passeig de Gràcia has performed well since opening in March, according to a store manager, who requested anonymity. “So far, traffic is normal,” she said. However, she pointed out that Marant’s shop, Barcelona’s first for the brand, is also located in a part of the Passeig that was largely unaffected by Tuesday’s protests.