Portugal’s Recovery Plan foresees loans of 4.3 billion

  • ECO News
  • 15 October 2020

The Recovery and Resilience Plan (PRR) presented in Brussels provides loans to invest in housing, businesses and trains.

The Recovery and Resilience Plan (PRR) presented by the Portuguese government this Thursday in Brussels foresees the use of loans worth 4.3 billion euros from the Recovery and Resilience Mechanism (MRR) to invest in three areas: social housing, capitalization of companies and Banco de Fomento and purchase of trains.

“The Portuguese government decided to maximize the use of European funds as a grant and to minimize the use of loans that may lead to an increase in public debt,” says the government in the PRR document to which ECO had access.

“Nevertheless, it lists three investments that deserve a careful evaluation of their eligibility, and under what conditions, for the MRR’s loan component,” the document adds, pointing to three areas where the investments still require clarification regarding the loans.

In total, MRR loans could amount to 4,295 million euros, with 2,745 million to be directed to the public affordable housing. Another 1,250 million are expected to capitalize on companies and strengthen the financial capacity of Banco de Fomento. The state also foresees 300 million in loans to finance the acquisition of long-distance railway rolling stock.

The European recovery plan envisages providing Portugal with 15.3 billion euros in grants and 15.7 billion in loans. However, António Costa stated more than once that the government’s priority will be to maximize the use of subsidies, minimizing the use of loans, due to the country’s high level of public debt.