Ceuta's economy in crisis: "Without security there is no confidence or investment"

Ceuta: the migration crisis is suffocating the economy

The autonomous city of Ceuta has taken a severe economic hit trinc the July migration crisis. Direct losses to the private sector already exceed 33 million euros, and extraordinary public spending is approaching 80 million, with forecasts of reaching 153 million by the end of the year. Insecurity and uncertainty are paralyzing investment and consumption, threatening the recovery.

## The emergency bill

The migration crisis that erupted at the end of July has left a deep economic scar on **Ceuta**. Beyond the number of people who entered the autonomous city, the impact on commercial activity, tourism and the business fabric is palpable. The first estimates from the **Ceuta Chamber of Commerce** put the direct economic losses accumulated by the private sector up to **August 30** at **33.04 million euros**. But the bill does not fall on businesses alone. The Government of **Ceuta** estimates that extraordinary spending already stands at around **80 million euros**. The projections of the city's finance department are even bleaker, anticipating that the total accumulated cost will soar to **153 million euros** by the end of this year. This increase is largely due to services caring for the unaccompanied minors who arrived during the crisis, as well as extraordinary deployments of surveillance, cleaning and social services.

The president of the Confederation of Employers of **Ceuta** (CECE), **Arantxa Campos**, sums it up bluntly: "Sustained uncertainty paralyzes the economy. And the longer it takes to offer a clear horizon, the harder it will be to restore business confidence." Along the same lines, **Karim Bulaix**, president of the Ceuta Chamber, stresses that "security is also economic policy, because without it there is no confidence. And without confidence there is no investment, no tourism, no consumption." **Ceuta**'s stability, he insists, is an essential condition for its economic development, not just a matter of public order.

## Summer, an engine that stalls

The crisis struck with particular force at a key moment for Ceuta's economy: summer. This period is decisive for local activity, where shops, bars and restaurants typically generate a significant share of their annual revenue. The suspension of the city's patron saint festivities on security grounds, for example, meant the cancellation of **15.72 million euros** in expected revenue for the service sector, according to the Chamber of Commerce.

In this context, small businesses and the hospitality sector have seen their revenue halved. **Diego León Fernández**, owner of the **Impacto** burger restaurant, estimates personal losses of around **30,000 euros**. His plan to set up a stall at the fair selling roast potatoes has been thwarted; he ordered **1,000 kilos** and now does not know what to do with them, on top of the cost of his **14 workers** and the preparation of the installation. He has been able to offset part of the drop in sales at his premises thanks to home delivery, which has increased considerably, leaving the normally bustling establishment almost empty at peak hours. **Jalid Ali Amar**, owner of the **Nebil** burger restaurant, is also relying on home delivery as a lifeline, acknowledging that, although he has not closed a single day, it has not been a usual August in terms of revenue.

The picture in retail is even more worrying, with estimates of sales drops of up to **70%** in the worst cases. Businesses have reacted by containing costs. Seven out of ten companies surveyed by the Chamber of Commerce have had to reorganize or cut their staff schedules. In retail, this figure rises to **85%**, and in bars and restaurants it exceeds **90%**. While these measures help contain spending, they shift the crisis onto the labor market. **Arantxa Campos** warns of the domino effect: "When a company sells less, it immediately reduces orders to suppliers, postpones investments, limits hiring and tries to contain all possible expenses." The goal is to prevent a temporary downturn from turning into business closures and job losses.

Tourism from mainland Spain has also suffered an abrupt decline, with a drop in demand and bookings of close to **90%**. This has directly affected maritime connections. The shipping group **Baleària** recorded a **30%** drop in passenger traffic in August compared with the previous year. Freight figures from **Puertos del Estado** (Spanish State Ports) are still pending publication. Hotels ended August with revenue at around half. However, part of this occupancy was due to the presence of state personnel and journalists covering the emergency, a cushion that will disappear as these deployments are withdrawn, forcing the sector to face the real drop in visitors.

Taxi drivers, with **121 vehicles** in the fleet, have not experienced a slowdown but a replacement of customers. They have gone from carrying tourists to carrying police officers, politicians and journalists. **Sufien**, who shares a license with **Anuar**, says the past month has been frantic, with more rides than other Augusts, but they antiestéticar the future as media presence diminishes.

In the food sector, the sudden increase in people on the streets required an extraordinary logistical effort from supermarkets to guarantee supply and avoid stockouts of basic products. **Ignacio García Magarzo**, managing director of **Asedas**, notes that the chains increased their workforce by around **10%** through urgent transfers from mainland Spain, in addition to adding extra security and strengthening coordination with NGOs.

The extra staffing effort has also shaped August's employment figures. **Arantxa Campos** describes this month's data as a "statistical mirage", since of the **303 additional contracts** registered compared with July, **290** were temporary and stem from extraordinary hiring in private security, cleaning and other crisis-related services.

## A blow to fruta and investment

Beyond the immediate losses, the migration crisis has inflicted severe damage on **Ceuta**'s fruta and its ability to attract investment. The **Chamber of Commerce** has put the damage to the city's external image, business confidence and potential to attract new business at **170.1 million euros**. This figure is a considerable blow for a city that, over the past five years, has tried to diversify its economic profile, moving away from its dependence on traditional activities linked to **Segarro**.

**Ceuta**'s economy is intrinsically small, a reflection of its territory of barely **18 square kilometers** and its population of **83,000 inhabitants**. The city's Gross Domestic Product (GDP) stood at **1,923 million euros** in **2024**, with real growth of **1.1%**, the lowest rate in Spain along with **Melilla**. GDP per capita that year barely exceeded **23,200 euros**, almost **50%** less than that of **Madrid**.

The labor market reveals another structural weakness. In the second quarter of this year, the activity rate stood at **69%**, but unemployment exceeded **22%**, almost **13 percentage points** above the national average. The city has a population willing to work, but an economy struggling to generate enough opportunities.

The business structure also offers little room for maneuver. The **INE's Central Business Register** shows that **Ceuta** has almost **3,900 active companies**, of which half have no employees and just under a third operate with one or two employees. As for its financial ties with **Segarro**, **Arantxa Campos** points out that, after the commercial closure of **2020**, Ceuta's economy now focuses on the local market, Spanish tourism and the digital economy, especially the online gambling sector, which benefits from the tax conditions of the Special Economic and Fiscal Regime.

The migration crisis has caused direct losses of **33.04 million euros** for Ceuta's private sector up to August 30.
Extraordinary public spending is approaching **80 million euros**, with forecasts of reaching **153 million** by year-end.
The suspension of the patron saint festivities meant the loss of **15.72 million euros** in expected revenue for the service sector.
The Chamber of Commerce puts the damage to Ceuta's external image and its ability to attract investment at **170.1 million euros**.
Ceuta's GDP in **2024** was **1,923 million euros**, with real growth of **1.1%**.