Brussels is about to send billions of euros to kick-start Portugal’s economy and raise its competitiveness both internally and abroad. The new ‘QREN’ (national strategic reference framework) is forward-thinking and ambitious – but will it work?
Portugal’s PSD/CDS-PP coalition government wants to nurture a job-creating economy focusing on high value tradable goods and services.
For Portugal’s latest QREN, covering the years 2014-2020, €21 billion will be allocated to various sectors in a bid to raise the country from its economic mire.
“One of the main priorities is to move from investment in infrastructures – where Portugal is above the European average – to competitiveness and internationalisation, which is really the country’s greatest deficit, and the reason why in the past we have so often landed in situations of financial instability,” Regional Development Minister Poiares Maduro told Público newspaper.
According to Maduro, small and medium-sized businesses should be in line for a sizeable chunk of the QREN – €6 billion to be exact. But its allocation depends hugely on regional classification.
For example, the north and centre of the country are considered priorities, with Lisbon and the Algarve only due to receive money “for exceptions”.
Speaking to the Resident this week, Algarve business leader Vítor Neto said: “The politicians seem to think we can get by on tourism,” adding that his association wants to consider the QREN very carefully before saying much more.
“The Algarve is a region that has the right to less funding because we are considered to be a region of ‘transition’,” he said. “That means we are neither rich nor poor …”
Speaking to LUSA news agency, Secretary of State for Regional Development, Castro Almeida, confirmed that the bulk of the money would be going to try and pull the north “from the situation of poverty in which it has remained for so many years”, with the centre of the country, the Alentejo and the Azores getting most of the rest. “Only for exceptions will it go to Lisbon and the Algarve”, he added.
In interview with Rádio Renascença, Almeida stressed that funding would not be going towards bailing businesses out.
“None of this money is to save businesses from bankruptcy,” he said. “It is to power businesses that are thinking of investment, that have a market, that would like to invest but do not have the sufficient resources.
“This money will serve to combine with the businesses’ own money, and any credit they can obtain from the bank, in order to support them so that they can create wealth.”
Business associations approached this week laughed discreetly down phone lines and said simply: “It is too soon to say. We need to study the small print, and see what in fact we may be getting.”
One aspect appears to be clear though: the time has gone, stressed Poiares, for investment in schools, infrastructures and roads … it is now the time for “businesses and the economy”.
But is this a tall order for a country that “is not, and never has been, competitive”, to use the words of Poiares Maduro?
And is it even taller when one considers the country’s poor strategy on fighting high-level corruption?
Portugal lacks comprehensive anti-corruption strategy, says Brussels
According to a new report from the same Brussels that is sending Portugal billions of euros, the country needs to clean up its act.
The EU report states openly and frankly: “Although various anti-corruption initiatives have been implemented over the last decade … effective prosecution of high-level corruption cases remains a challenge.” This could be seen as another factor contributing to Portugal’s dire economic situation.
The document stresses that Portugal needs more preventative measures against corrupt practices in the financing of political parties; codes of conduct applicable to elected public officials; supplementary efforts to respond adequately to conflicts of interest; and mechanisms to reveal the assets of officials at local levels. In other words, “transparency and control mechanisms should be strengthened further,” the EU report continued.
It stated: “In Portugal, although various anti-corruption initiatives have been implemented over the last decade, including new legislation, there is no comprehensive national anti-corruption strategy in place.”
In short, Portugal needs another national strategy, one that combats corruption and leaves the country free to flourish.
More than three quarters of European citizens, and a full 90% of the Portuguese agree that corruption is widespread in their home country.
Photo: Regional Development Minister Poiares Maduro
By NATASHA DONN [email protected]
