Susana Vera/Reuters
Protesters shout slogans and wave Esteladas (Catalan separatist flags) as they gather outside the High Court of Justice of Catalonia in Barcelona, Spain, September 21, 2017.
Catalonia says that it has won the right to be independent, but proposes suspending the consequences of the vote "for dialogue."
Carlos Puigdemont, the Catalonian president, told the regional parliament in Barcelona on Tuesday evening local time (CEST) that "we propose to suspend the effect of the independence declaration ... in order to work towards putting into practice the result of the referendum."
"Today, we are making a gesture of responsibility in favor of dialogue," he added.
Puigdemont's statement was not a unilateral declaration of independence. Some were expecting the region to declare independence on Tuesday.
Spain's Constitutional Court ruled that the independence referendum was illegal ahead of the October 1 vote, and Spanish Prime Minister Mariano Rajoy previously vowed to keep his country together regardless of the outcome.
Spain's King Felipe VI, in a rare televised address to the country two days after the vote, criticized the Catalan government, saying they "have placed themselves outside the law and democracy, they have tried to break the unity of Spain and national sovereignty."
A declaration of independence theoretically would not only lead to immediate political uncertainty in the region, but would also increase the risk of economic uncertainty for both Catalonia and Spain.
An independent Catalonia would not not be part of the European Union, the European Commission said last week.
What happened during the referendum vote?
Earlier this month, 2.2 million Catalans, or 43% of the region's eligible electorate, voted for independence on a day marred with violence as Spanish riot police used batons and fired rubber bullets on protesters. Around 900 people were injured that day. Protests broke out over the crackdown the following Tuesday in Catalonia.
The number of people voting for secession has been "broadly stable" since 2014, and a "clear majority" did not endorse such an action on Sunday, according to The Financial Times.
Spain's Constitutional Court ruled ahead of the vote that the referendum violated the country's constitution because it "does not recognize the right to self-determination and establishes that sovereignty resides with Spanish citizens collectively," according to the Washington Post.
The Spanish government has taken a strong stance against the referendum ahead of the vote by raiding offices, shutting down pro-independence websites, and arresting officials. Some analysts have argued that the recent crackdown has only helped to further unite the pro-independence groups in Catalonia.
Tensions go back decades
Tensions between Catalonia and Spain go back decades. According to Bloomberg, the region's push for autonomy was a factor in the Spanish Civil War. Afterwards, the Franco regime cracked down on the language, on Catalan institutions, and on the people themselves.
Following Franco's death, the Spanish constitution of 1978, which says the nation is "indivisible," gave Catalonia language rights and control over its healthcare and education.
Recently, nationalists in Catalonia have pointed to the region's language and culture, and have argued that the region subsidizes the rest of Spain, according to CNN. Catalonia pays about €10 billion ($11.8 billion) more in taxes than it gets back, according to data from the Spanish Treasury, as cited by Reuters. By comparison, Andalusia, the poorest region, gets almost €8 billion ($9.4 billion) more than it pays.
On the economic front
Catalonia, which has its own language and culture, is one of Spain's economic powerhouses. It contributes nearly one-fifth of the country's total GDP and has an economy larger than that of Portugal.
Maurice Obstfeld, the International Monetary Fund's chief economist, told reporters that a Catalonian split would cause "a lot of uncertainty for both the Catalan and Spanish economies," the BBC reported on Tuesday. Several major banks based in the region, including Banco Sabadell and Caixabank, are also reportedly moving, or considering moving, their headquarters out of Catalonia if the region declares independence.
The euro was up by 0.6% at 1.1805 against the US dolalr at 2:03 p.m. ET (8:03 p.m. CEST).