An opinion piece advocates for the Department of Commerce as key to preventing income leakage in wealthy municipalities like Pozuelo, where money escapes every morning to Madrid.
One euro spent in a shop in Pozuelo de Alarcón can pay the salary of a local employee, the rent of a business in the municipality, the taxes that revert to public services, and moreover, become another purchase within the village itself. This is what economists call the local multiplier effect, a concept that is rarely heard in municipal plenary sessions but, according to an analysis released this week, should be the obsession of any mayor.
The text, which has circulated among business and political circles in the western area of Madrid, argues that municipalities like Pozuelo, Boadilla del Monte, or Majadahonda boast of being the richest in Spain, but that wealth was not created by the City Council but rather by the urban luck of past decades. The real challenge, it points out, is to ensure that money circulates within the municipal boundaries and does not shoot off every morning towards the capital.
The paradox of the Department of Commerce
According to the analysis, the Local Department of Commerce is often the poor relation of the municipal structure, with tight budgets and limited capacity for action. While mayors inaugurate hospitals, parks, and sports centres, local commerce languishes due to a lack of a coordinated strategy involving urban planning, mobility, parking, hospitality, culture, cleanliness, and security.
“A well-lit shop window does more for a street than twenty institutional speeches,” the text reads. The key, according to the source, is not only to retain the money that is already in the municipality but to attract consumers from outside: for someone to decide to come from Madrid, Majadahonda, Las Rozas, or Boadilla to shop, eat, or stroll, leaving new wealth, jobs, and life in the streets.
Income leakage, a silent problem
The local multiplier effect breaks down when residents of Pozuelo do their shopping outside the municipality. “That wealth was not created by the City Council. It has had the luck —or the urban planning acumen of decades ago— to attract it,” the article points out. The merit, it insists, begins afterwards: achieving that the money generated by executives, entrepreneurs, and self-employed professionals living in the area stays in the village.
For the author of the text, many municipal officials have never had a paycheck that depended on selling something, which is why they believe that energising commerce consists of organising food fairs or distributing brochures. “Merchants continue to perform real juggling acts to compete with the internet, large shopping centres, and rising costs,” it laments.
What would change in the daily life of residents
If Pozuelo were to enhance its local commerce, residents would notice livelier streets, fewer vacant shops, increased security, and a greater range of services without the need to travel. The text proposes that the Department of Commerce become one of the crown jewels of the municipal government, with real capacity to coordinate all involved areas. “Votes last four years. The economy of a town, when done right, can last for generations,” it concludes.
For now, the debate is underway in local forums, where some councillors have shown their willingness to work in this direction, although they lament that “their hands are tied for God knows what reason.”
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