Portugal wants €750 billion EU bazooka fund available before August

Portuguese foreign minister Augusto Santos Silva. [EPA-EFE/ANTONIO PEDRO SANTOS]

The Portuguese EU Council presidency is working so that the process of releasing the €750 billion from the EU’s post-pandemic Recovery Fund can be shortened by at least one month.

Minister of Foreign Affairs Augusto Santos Silva indicated the revised timeline on Tuesday (28 April) at the Commission of Economy, Innovation, Public Works and Housing of the Portuguese Parliament.

The minister defended his view that the deadlines for analysis and approval, either by the European Commission or the Council, should be shortened to July.

Portugal’s top diplomat recalled that a meeting of ECOFIN is scheduled for 18 June to analyse a first package of national plans.

Once all the national plans have been submitted, a milestone which has been given the deadline of 30 April, the Commission has two months to approve them. After that it will be up to the 27 ministers of economy and finance to analyse all the documentation within a month, which would drag the release of funds to support Europe’s economic recovery out until at least August.

Santos Silva pointed out that 18 EU member states have already ratified the decision on own resources, which needs the approval of all 27 for the Commission to go to the markets.

“We hope that, by the end of spring, things will be resolved so that the European Commission can go to the markets to make the loans of €750 billion for the fund,” Santos Silva said.

In relation to Portugal, the minister noted that the business dimension of the PRR (recovery and resilience plan) in the country is “very high,” stressing that Portuguese companies are in line to receive €4.9 billion.

Santos Silva highlighted the €1.5 billion put aside in the plan for capitalisation and business investment, to be managed by state bank Banco de Fomento, and another €1.3 billion for “reindustrialisation processes that typically combine technological processes with business innovation”.

“Other very important tranches will go to industrial decarbonisation, digital transition of companies and new clean energies, namely green hydrogen, for the purposes of industrial and business use,” he stressed.

Santos Silva also said there had been “signs of confidence” in the Portuguese economy already in 2021, pointing out that if you analyse the chain variations in exports and investment, “you can see that the cycle is turning positive again”.

“The latest available data on our exports, for February, shows a 3.4% growth in Portuguese exports when compared to January,” he said.

“Even more important is the sign of international confidence and of international investors in the conditions for investment in Portugal, seen by the announcement of a major investment in a data centre in Sines, which will represent, by 2025, a value of €3.5 billion, generating, at cruising speed, 1,200 new jobs in the data industry, of data-related service activities,” he added.

For Santos Silva, this is an “important investment from an economic and digital transformation point of view”, which will also take advantage of the first undersea fibre optic cable between South America and Europe.

[Edited by Josie Le Blond]

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