Algarve seriously affected by State Budget 2011

Algarve politicians and tourism experts expressed their concern this week about the State Budget for 2011 which includes a series of tax increases and public spending and salary cuts (click the link to the right to read the special report by Chris Graeme).

Former leader of the Social Democratic PSD Party in the Algarve Mendes Bota said that the Socialist PS government has been the “greatest disaster for the region since the 1755 earthquake in Portugal”.

“(Prime Minister) José Sócrates sucked the region dry with taxes, reduced public investment and destroyed its economy,” he said, referring to the region’s “suicidal” politics of approving the construction of several large shopping centres.

“Construction works for the Hospital Central do Algarve have stopped, redevelopment work to improve the EN125 has barely started, among many other works that are stopped because of bad investment management by the Government.

Meanwhile, Faro Mayor Macário Correia predicts a bad year for the Algarve with the decline in public investment and the introduction of tolls on the A22 road.

“We are the region generating most revenue for the State but the Government invests so little here,” he said.

According to the president of the region’s association of hotels and tourism accommodation (AHETA) Elidérico Viegas, the cut in the salaries of the Portuguese and tax increases planned for 2011 will affect tourism in the Algarve.

“Tourists will come to the region for shorter periods and spend less money while on holiday,” he said, also noting that “the tourism-related businesses will become less competitive compared to other cheaper destinations.”

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