Portugal2020 to bring floating tower and dozens of factories

With less than a year left to run in the ambitious Portugal2020 programme, all kinds of developments are suddenly being touted in the press, including the construction of an extraordinary ‘floating tower’ in Lisbon – aimed at attracting yet more tourists – and dozens of factories throughout the country.

Portugal2020 is the mechanism designed to ‘finally give back’ after the crippling effects of the economic crisis.

Roughly €26 billion has been promised to promote ‘intelligent, sustainable, inclusive’ projects.

The money is coming from the EU and European Central Bank and its use will be closely monitored over the coming years until the time comes for ‘pay back’.

An English-language translation of the government’s Portugal2020 site explains: “The European Union has a number of protocols that will be followed throughout the entire period of the financial aid. The spending of every single euro will be closely monitored by Union Officials, as any breach in agreement from the side of the Portuguese government might result in the expulsion of the country from the EU; and nobody wants that to happen. We will see what the year 2020 has to offer.”

And the papers are full of promises, extolling on so many investments to come in this ‘crucial’ election year.

Diário de Notícias particularly has devoted space to what lies in store, highlighting 20 major projects led by the impressively named Lisbon Floating Tower – which “promises to be different from everything that has ever existed”.

“It will be a structure with navigational capacity, although it won’t be a boat,” explains the paper, adding: “It means to enhance the historic, gastronomic and scenic heritage of the city, attracting more tourists to Lisbon. It will cost €25 million – about a fifth to be funded by Brussels’ programmes.”

The brainchild of businessman Carlos Martins – chairman of the Martifer group – it is being described as one of the large private projects that won funding from FEDER (the European Fund for Regional Development) last year.

Indeed, 2018 is described as having seen projects valued at €3.3 billion given the green light, all of which should be completed by 2022.

The 20 largest – each costing over €10 million – will see EU funding ease them along to the tune of €191 million, though surprisingly there is very little information available yet on ‘Lisbon Floating Tower’.

DN moves swiftly on, saying “apart from the floating structure to be constructed on the Tejo river, Portugal2020 will host three hotels, in Porto and the Azores”.

One – owned by Algarve chain Conforhoteis – will be helped by a €5.5 million EU cash injection, while the others are to receive €4.5 million and €6.3 million, respectively.

Reading between the lines, the ‘news stories’ may well have been orchestrated as part of the government’s PR at a time when it is beset with discontent and strife within the public sector.

To this end, Diário de Notícias launches into the prospect of “dozens of factories”, led by the single largest investment of South Korean group Hanon Systems, which will be investing €48 million in a new plant for electric compressors, €12 million of which will come via FEDER.

Other projects include the North American Alchemy project in Porto (receiving €16 million from the EU, and destined to become a “centre of excellence to support industries in the areas of genetic microbiology and metabolic engineering); a factory for photovoltaic panels to be produced for export in Oliveira dos Frades (supported by €15 million in EU funding); a biorefinery in Sines (receiving around half of its €23.5 million investment from the EU); and other projects also connected to renewable energies.

Portuguese pulping companies like Navigator and Fapajal Evo will also be picking up financial aid for projects “dedicated to forestry transformation”, which DN explains means “creating new products from eucalyptus”.

Among other winning candidates are projects for the “production of injectable pharmaceuticals” (in Arruda dos Vinhos), all-terrain vehicles (Abrantes), life-saving buoys (Torres Vedras), activated charcoal (Mira), fruit processing (Beja) and prefabricated walls (Azores).

But will they really all get off the ground? This has to be the big question to be set against the experience of investors like Robert Yildirim of the Turkish Yildirim Group who gave an insightful interview with Expresso earlier this month.

Yildirim, despite having his name spelt incorrectly throughout the text, has proposed investment (seemingly without EU funding) of around €450 million in ports between Leixões and Lisbon. But try as he might to move things along, he says “things do not happen”.

The government is “friendly. They smile a lot. But the projects don’t move forwards”.

Yildirim’s issues appear to lie in receiving the right authorisations.

Finance has been assured, he explains, but ‘details’ with government authorities are just holding everything up “and this isn’t good for people who want to invest in Portugal, like us”.

There could be reasons behind the delays that Yildirim may not have appreciated, but the headline “I am sorry to say this, but in Portugal things move very, very slowly” will resonate with any business person who has ever tried to advance with what they believe to be a winning idea.

Portugal2020 sounds like the new El Dorado, but for anyone who has seen EU projects proclaimed in the past, ‘the proof will be in the pudding’ – and the pudding is still quite some way from coming out of the oven.

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