HE FOUND the note in the pocket of his daughter’s jacket when she came back from school. “Pay your revolutionary tax or you will face the consequences,” the scrawled demand read.

For Rodríguez Achútegui, who runs a timber business in the Basque Country, it was a defining moment. Businessmen in this part of Spain are no strangers to threats of extortion from Eta, the Basque separatist organisation. However, the manner of the threat — approaching his seven-year-old daughter at school — was especially frightening.

“For me, it was too much,” Señor Achútegui said. “We decided to close up and leave, which was very sad.”

Eta’s declaration in March of a “permanent ceasefire” fuelled real hope that the terrorist organisation’s bloody 38-year campaign was finally over.

In the post-9/11 political climate and after a spate of arrests of its leading activists, Eta seems to have lost its appetite — and ability — to kill. Now the Basque business community is cautiously hopeful that the region may at last be able to shake off the spectre of terrorism that has held back the economy of this rich part of northern Spain for so long.

Latest figures released by the National Institute for Statistics in Madrid showed that Spain’s GDP grew by 3.5 per cent in the first quarter, compared with the same period in 2005. However, the Basque Country is still missing out on the Spanish boom. Studies have shown that Eta terrorism has held back the region’s economic growth by 10 per cent.

Javier Gardeazabal, Professor of Economics at the Basque Country University, carried out a study into the situation with Professor Alberto Abadie, of Harvard University. Señor Gardeazabal said: “The economy of the region could have grown 10 per cent more without the effects of terrorism. And in peace time, we have seen that Basque companies have seen better results in the Bolsa [the Spanish stock exchange].”

From 1995 to 2002, a Basque regional government study showed, the region’s economy GDP grew 27.8 per cent, a rate lagging behind other, less prosperous, areas of Spain. Valencia’s GDP rose 30.8 per cent, Andalusia’s 30.4 per cent and Murcia’s 32.6 per cent.

Another study by the Spanish Official Commerce Institute found that the Basque Country had its best period of economic growth between 1998 and 1999, when Eta called a truce.

Iñaki Anasagasti, of the Basque Nationalist Party, said: “It is no accident that the Basque economy grows when there are no bombings.”

Compared with other parts of Spain, the region’s tourism sector could have capitalised more on the popularity of attractions such as Bilbao’s Guggenheim Museum and its excellent food, reputedly the best in the country. Other areas, such as Andalusia, Catalonia and Valencia, have proved more attractive — and not just because they offer the classic combination of sol y playa (sun and beach). British and American tourists, especially, have proved reluctant to travel to a region where, however unlikely it is in reality, they fear that they will be the victims of terrorist attacks.

The Basque Country has proved to be one of the biggest exporters of cars, car parts, tyres and iron and steel products. However, since the end of the 1998 Eta truce, Basque exports to the rest of Spain and beyond have suffered a 68 per cent fall, according to the regional government statistics service.

It is unlikely that other Spaniards are boycotting Basque goods in the way that they stopped buying cava, the sparkling wine, produced in Catalonia in a dispute over the region’s move for greater autonomy.

Antón Damborenea, of the conservative opposition Popular Party, said: “To consumers, it is not obvious these are Basque products, so the idea of a boycott would not work in the same way.”

Loss of foreign investment has been harder to calculate. However, figures from the Basque Statistics Office suggest that as much as €9 billion (£6.1 billion) of investment from foreign companies has gone elsewhere between 1994 and 2004.

Businesses that do not pay what Eta calls the “revolutionary tax” are bombed or burnt down. The cost of business infrastructure and the expense of replacing and insuring it have been highly damaging.

In addition, there has been a more subtle, but equally debilitating, effect on Basque business people. One businessman said: “It is hard to concentrate on running a business when you cannot stop thinking about the security of your family.”

Add to this other “lateral” costs that the Basque economy has had to bear. At least 2,000 people must live 24 hours a day with a bodyguard under threat of death for opposing Eta.

Judges, councillors, police chiefs and business people who have refused to pay the “revolutionary tax” all have a human shadow. The cost of paying 2,500 bodyguards, met partly by Spain and the Basque regional government, is €152 million a year. This is money that could have been invested in supporting businesses or promoting the Basque Country abroad.

Then there is the cost of public security — police inquiries, policing Eta-related demonstrations and paying the bomb squad and anti-terrorist units. The Spanish Interior Ministry puts the Basque security bill from 1984 to 2003 at €3.5 billion.

Finally, there is also that compensation that is paid by the Spanish and Basque authorities. Since 1968, Eta has killed 817 people, kidnapped 77, carried out 2,184 attacks and held 7,700 street protests. Between 1974 and today, the bill for these actions has been put at €486 million.

Pilar Blásquez, a Spanish journalist, said: “If the truce is real — that’s to say without extortion or violence — Basque business people can dedicate themselves to regenerating their economy and forgetting the losses of the last few decades.”

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