Government admits resorting to more “bazooka” loans later this year

  • ECO News
  • 24 August 2022

The Treasury and Public Debt Management Agency (IGCP) told investors that Portugal may request up to €2.3 billion in loans from the RRP this year.

Portugal has so far requested only one-fifth of the €14.2 billion in loans to which it is entitled under the Recovery and Resilience Plan (RRP). However, the Portuguese government may request up to €2.3 billion more later this year, due to the economic effects of the war in Ukraine and the support requested by companies, reports Jornal de Negócios.

The possibility was admitted to investors by the Treasury and Public Debt Management Agency (IGCP). “The authorities currently intend to use €2.7 billion in loans” from the RRP, but, “in the second half of 2022, they may consider an additional amount”, which could go “up to €2.3 billion,” reads the presentation documents to investors from the agency that manages public debt. The additional request aims to “strengthen financial support to companies for capitalisation” and to foster innovation projects.

The Ministry of the Presidency, which is in charge of the RRP, does not deny the possibility of requesting more loans until the end of this year, recalling, however, that according to the Recovery and Resilience Mechanism, “a member state may request loans until August 31, 2023, which may be granted by the European Commission until December 31, 2023. Portugal is still entitled to an additional €11.5 billion in loans from the European “bazooka”.