Juan Carlos I Seeks Redemption, for Spain and Monarchy via New York Times | News in english | Scoop.it

Published: September 28, 2012


MADRID — With Spain mired in an economic slump, many Spaniards are questioning their king, long revered for his role in bringing democracy to the nation but now being scrutinized for his deluxe lifestyle and opaque fortune.


An accident this spring, when the king broke his hip while elephant hunting in Botswana, exposed a rarefied world of business contacts and set off an unusual public outcry over why the Spanish monarch, Juan Carlos I, was off on a pricey African safari during a time of national hardship.

The episode led to an unusual royal apology, but the collateral damage has left the king, 74, recalibrating his monarchy. He has stepped up his public appearances, embracing his role as an international business booster and conciliator amid rising fury over government-imposed austerity measures intended to help shore up confidence in the country’s finances.

“The monarchy will continue as long as the people want a monarchy,” the king said on a swing through New York last week, part of a palace strategy to meet with top opinion makers to help promote confidence in Spain.

Europe’s economic crisis has politicians and struggling taxpayers from Belgium to England openly weighing the costs of subsidizing royals. Unlike other European monarchs, Juan Carlos came to the throne after the death of the dictator Gen. Francisco Franco in 1975 with virtually nothing, and has worked hard to generate his own fortune beyond the annual 8.3 million euro budget, or $10.7 million, bestowed on the palace by the Spanish government.

The king is widely valued in business circles for acting as a sometime deal maker and economic ambassador for his nation, but how he has amassed his substantial personal wealth remains secret. The Spanish royal family’s wealth has been estimated at up to $2.3 billion, a sum that supporters contend was inflated by the inclusion of government properties.

To promote Spain’s businesses and help repair his image, Juan Carlos took the controls this month of a cutting-edge NH90 helicopter during a visit to a Eurocopter manufacturing plant in Albacete. On Thursday, he inaugurated a new Barcelona container terminal.

It is all part of his campaign to advance “Brand Spain,” as the king put it in response to written questions, another palace step to demonstrate openness. His message for Spanish business, he added, is straightforward: “Export, export and export.”

Juan Carlos’s peripatetic role as a business diplomat and deal maker was brought into the limelight after the safari, which was subsidized and organized by Mohamed Eyad Kayali, a Syrian construction magnate.

The two longtime friends had worked together on a $9.9 billion bullet-train contract that the monarch helped broker last autumn for a Spanish consortium in Saudi Arabia. Leveraging his friendship with the Saudi king and other royals, Juan Carlos outmaneuvered a French bid.

Supporters and advisers to the palace insist the king does not receive commissions on the deals he mediates or promotes.

“They have tried to be more transparent by revealing their annual budget,” said Herman Matthijs, a finance professor at the University of Brussels, who analyzes government spending on Europe’s royalty and unsuccessfully sought information about the king’s personal fortune. “I suppose at least that he is a millionaire, but the question is: Is he a billionaire? What is their real wealth?”

Spain lived without a king for 38 years after the Spanish Bourbon family was exiled in 1931 and their properties expropriated. Franco, who operated as a dictator from the end of the Spanish Civil War in the 1930s to his death, handpicked the king in 1969 to succeed him.

The king’s authority is limited by the Spanish Constitution to mostly ceremonial powers — essentially a nonruling monarch.

Before his accession to the throne, the king was aided by financial advisers who created a subscription campaign when he got married to help build a financial cushion. During that period, the future king “became obsessed with building up a personal fortune,” said José García Abad, the author of two books about the monarch.

In this “annus horribilis” for the Spanish royal family, the king has kept himself at arm’s length from an influence-peddling case aimed at his son-in-law, Iñaki Urdangarín, who is accused of using a nonprofit foundation to embezzle public money from sporting events and of exploiting his royal background to skip standard bidding procedures.

On his travels, the monarch can accept gifts in the name of the Spanish government, but there is no public list of the presents. Over the years, he has received yachts, an island home and luxury autos to add to his large collection of cars, provoking caustic Twitter messages like, “The Spaniards in slippers and the king with 70 cars.”

In the midst of Spain’s economic crisis, the king and his son, Crown Prince Felipe, agreed to a 7 percent cut in the royal budget.

But some opposition lawmakers see Spain’s downturn as further reason to challenge the monarchy.

“There is absolutely zero control on the activities of the king and his household,” said Joan Tardà, a national lawmaker from Esquerra Republicana, a Catalan party that wants Spain to hold a referendum on the monarchy.

Polls taken after the king’s hunting trip accident in April showed that Spaniards forgave him, but most yearned for more transparency.

Supporters of and advisers to the royal palace describe the king as an irreplaceable resource with unmatched relationships with world leaders. They credit his skills in smoothing tensions between Spain’s former Socialist government and the George W. Bush administration and helping to resolve disputes in Latin America.

“From a corporate point of view, he is Spain’s No. 1 ambassador,” said César Alierta, chairman of Telefónica, the Spanish telecommunications giant.

Some allies also consider him a crucial resource in advancing Spain’s economic interests outside the country. The Saudi high-speed train is their case in point.

“Without the king, this contract would not have gone ahead,” said a former Spanish foreign minister, Miguel Ángel Moratinos. “This kind of contract comes down to a personal decision by King Abdullah of Saudi Arabia.”

The Botswana trip was subsidized by Mr. Kayali, who also serves as a key adviser to Prince Salman bin Abdulaziz Al Saud, the crown prince in Saudi Arabia who played a role in awarding the Saudi train contract.

Mr. Kayali declined to comment.

Along on the expedition was a German princess, Corinna zu Sayn-Wittgenstein, 47, and her young son and former husband. The Spanish gossip press labeled her the monarch’s longtime mistress — something she denied in an interview. She also denied that she had somehow benefited from her association with Juan Carlos through a now defunct Spanish-Saudi investment fund.

Ms. Sayn-Wittgenstein called the king a family friend and described her role on other royal trips as a strategic adviser to the Spanish government through her company, Apollonia Associates, which offers advice about high-end Middle East deals.

“The king is a national treasure,” she said. “When he walks into a room, he radiates warmth and charisma and he connects with everybody. Nobody remains untouched by it.”

A version of this article appeared in print on September 29, 2012, on page A1 of the New York edition with the headline: Chastened King Seeks Redemption, for Spain and His Monarchy.