Algarve economy on the table

Measures to protect jobs and bolster Algarve’s economy were discussed on December 21 in Lisbon during a meeting between the Algarve Tourism Board President and the Minister of Economy and Employment.

Minister Álvaro Santos Pereira heard Desidério Silva on several issues currently affecting the Algarve economy.

Silva requested that the government looks into the “difficult situation” surrounding the Via do Infante (A22), both from an economic and social perspective: namely the lack of traffic since tolls were introduced in December 2011 and the electronic toll payment system which has caused great confusion among users, particularly those driving foreign-plated vehicles.

In a statement sent to the Algarve Resident, the Algarve Tourism Board said it was pressing to find a solution that would facilitate the payment of tolls by all users.

Closely linked with the tolls issue is the chaotic and dangerous EN125 road, both because of the high traffic volume and the degraded road surface, which lead to unsafe driving conditions. “It’s vital that the redevelopment programme for the EN125 resumes without delay,” continued the statement. “The halted road works are affecting the image of the Algarve.”

The 23% IVA rate charged in the restaurant and golf sectors was another issue debated at the meeting, for it is “clearly harming” the economy and its competitiveness levels against the Spanish market, where IVA in those sectors is 10%.

Promotion abroad

Desidério Silva went on to highlight the importance of reinforcing promotional campaigns in international markets, namely Central and Northern European countries, Russia and Canada, in order to attract more first-time visitors.

“We need to fight the problem of seasonality. But this can only be achieved if we are able to attract more visitors through the creation of additional flights to the Algarve,” he said. “It is important to invest in existing air routes but also add new ones.”

The president of the Algarve Tourism Board said he hoped the Portuguese flag-carrier TAP would start flying to new European cities from Faro.

Another way of attracting visitors to the region would be by establishing a visa system that is more flexible and facilitates the entry of citizens from outside the European Union, said the Algarve tourism boss.

Bolstering the tourism promotion budget was also crucial, given that the Algarve is the largest holiday destination in Portugal and should be “valued and respected as the region that most contributes to the national economy” in terms of tourist revenue.

The residential tourism segment in the Algarve, another important revenue generator, should receive more attention from the government along with the health and wellbeing segment. “The Algarve offers exceptional conditions for these very important segments,” said Desidério Silva.

Job security

In order to increase job opportunities in the Algarve, Desidério Silva called on the government to review the Formação Algarve (Training Algarve) programme, so that this year more people could be covered by the scheme, “which did not achieve its objectives in 2012”.

This is a tailor-made measure by the Government to fight unemployment and job insecurity in the Algarve. This special employment incentives programme offers financial support to companies that hire new staff, complying with special terms and conditions.

Another issue on the table was the problem of excessive bureaucracy that is putting off investors from investing in the Algarve. Obstructive bureaucratic systems need to be speeded up, recommended Silva, and measures to increase employment need to be created. Investors and companies enhancing employability levels should also be recognised for their input into the economy.

Desidério Silva says he feels confident the Minister of Economy will reply swiftly and positively to the issues raised.