Government withdraws new loans to bolster recovery and resilience plan

The government announced this Thursday that it will not seek additional loans to strengthen the Recovery and Resilience Plan (PRR). Thus, Portugal’s plan, the reprogramming of which is still subject to approval by Brussels, should provide for a maximum allocation of 22.2 billion euros.

Member states had until this Thursday to apply for new loans from the European Commission. In May, Presidency Minister Mariana Vieira da Silva acknowledged that the government was still exploring the possibility of resorting to new loans “up to the $11 billion limit to attract strategic investment to the country. However, the intention will be left along the way.

“Taking into account the evaluation of the known expressions of interest of strategic investments for the country, their state of maturity and implementation schedules, as well as the timetable for the implementation of the PDP until 2026, the government decided that there will be no additions to the investments and reforms already invested. negotiations are underway with the European Commission,” the government now explains in a note sent to the editorial office.

The executive branch informs that in order to fulfill the promise to increase the attraction of investments, a “contractual mechanism for strategic investments will be created, examining precisely the current framework of state aid, integrated into the industrial plan of the European Union’s Environmental Pact.” “, as has already been said.

The mechanism is being worked on by the government departments of economics and foreign affairs, and is “aimed at responding to expressions of interest, namely in areas such as microchips, green industry and sustainable mobility, the implementation of which is beyond the PRR time horizon.”

“This initiative will complement the existing measures to encourage projects with a structuring effect, of which the PRR and RCM Mobilization Programs 34/2023 [resolução do Conselho de Ministros que estabelece um sistema de incentivos financeiros a grandes projetos de investimento] are examples,” he points out.

The government is still awaiting approval of the reprogramming presented to Brussels in May, which will increase the PRR from the current 16.6 billion euros to 22.2 billion euros. Of this additional amount, about 2.4 billion are grants and 3.2 billion are loans.

Thanks to the reprogramming, the national PRR program now has a total of 43 reforms (up from the original 31) and 113 investments (down from 83) linked to a total of 501 goals to be achieved by the first half of 2026.