Spanish Prime Minister Mariano Rajoy promised to dismantle the Catalan government Thursday after accusing Catalan Regional President Carles Puigdemont of failing to comply with an ultimatum to tell the federal government whether the region had truly seceded.
Puigdemont didn't back down, however, and threatened to go ahead with a unilateral proclamation of independence if the government refuses to negotiate.
But Mr. Rajoy also depends on the backing of parliamentary factions from Spain's Basque region and the Canary Islands that are more reluctant to take a hard line and create precedents for the suspension of regional powers.
Spain's worst political crisis in almost four decades of democracy could hamper a still fragile economic recovery in the country as a whole and cause particular financial harm to Catalonia, which is already experiencing a flurry of corporate flight.
The Spanish government said Thursday it would begin the process to impose direct rule on Catalonia in an unprecedented move to crush the region's independence bid.
About 40 per cent of Catalonians turned out to vote and the regional authorities said more than 90 per cent of them backed independence.
The announcement came nearly immediately after the Catalan leader, Carles Puigdemont, facing a second deadline to clarify Catalonia's intentions since it held an October 1 referendum on independence, warned that regional lawmakers were prepared to break from Spain. Rajoy's government dismissed the referendum as illegal.
As the political dispute intensified, popular sentiment appeared to be hardening on both sides as well.
Íñigo Méndez de Vigo, spokesman for the Spanish government, said at a news conference that Madrid was ready to use "all the means within its reach to restore the legality and constitutional order as soon as possible". "I support our government; it's defending the unity of Spain".
"Puigdemont wants dialogue with the central government, and they say, 'No, no, no!' every time", said Jordi Costa, 47, a waiter in Barcelona, the Catalan capital. "I think coexistence is now more hard than ever".
So far, however, Puigdemont has only called for negotiations with Spain and global mediators.
The standoff has intensified since October 1, when Catalan authorities held an independence referendum that Spain's Constitutional Court declared illegal. Catalonia, home to 7.5 million people, has its own language and traditions and enjoys a degree of self-rule. Contributions of 200 words or more will be considered for publication.
The dispute is increasingly encroaching on the European Union's political agenda. Spain has ruled out worldwide mediation.
Leaders did not hold a discussion of Catalonia's bid to break away from Spain and judged they had nothing to gain by angering Madrid, diplomats said.
German Chancellor Angela Merkel said she hoped there were solutions "on the grounds of the Spanish constitution".
This was echoed by French President Emmanuel Macron, who held a private meeting with Rajoy on the sidelines of the summit.
The rapid succession of events moved what was already one of the gravest crises in Spain's relatively young democracy to a far more serious and unpredictable stage, with the prospect that Madrid could take over the running of Catalonia.
Madrid had on Wednesday proposed fresh regional elections, sanctioned by the central government, as a potential way out of the crisis.