Portugal has expressed its intention to ask for 3.3 billion Euros in additional loans


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Portugal has expressed its intention to request 3.3 billion euros in additional loans under the Recovery and Resilience Plan (RRP), the European Commission announced today, calling for the country to “move full speed ahead” in implementation.

“It is important to accelerate the implementation [of the RRP], including the RepowerEU measures, also in a context where Portugal has requested €3.3 billion in additional loans,” said Valdis Dombrovskis, Executive Vice President of the European Commission with the portfolio of ‘An economy serving the people’.

The official was speaking at a press conference in Brussels on the day the EU executive presented the spring package of the European Semester, in which he urged Portugal to end support measures for families and businesses due to the energy crisis and use the ‘slack’ to reduce the deficit, also requesting that the country speeds up the implementation of the PRR.

A European source explained to the Pp agency that, under the RRP, Portugal expressed “its intention to request additional loans, in a range between 3.3 billion euros and 11 billion euros,” when the plan was revised and the measures related to the RepowerEU energy package were included.

Another source explained that it is more likely that the country will opt for the 3.3 billion euros, although the concrete amount of additional loans will only be known upon official submission to the European Commission, which has not yet happened.

The latter source said that, according to the Portuguese authorities, the revised PRR with the RepowerEU program included should soon be submitted by Lisbon to Brussels.

In statements to the press, Valdis Dombrovskis also spoke of an “additional €704 million in grants through the RepowerEU program.”

“All this also requires additional reforms and investments, so it is important that [Portugal] submit the adjusted plan while continuing to move full speed ahead in implementation,” he indicated.

European Commissioner for the Economy Paolo Gentiloni, meanwhile, indicated that as far as the RRP is concerned, Brussels sees no “special delays.”

“We are just putting pressure on [the country] to finalize the chapter on RepowerEU and the successive stages of the plan,” he explained.

He also highlighted “the challenges that Portugal is facing” in budgetary terms.

“First […], debt ratios are decreasing and if this trend continues, as is the plan of the Portuguese authorities, this would allow next year to be free of imbalances; while the second point we emphasize is the fact that house prices have increased strongly in recent years, although this growth is now being moderated and the policy response is considered adequate by the Commission,” Paolo Gentiloni said, speaking of a “trend for imbalances to go in the right direction” of reduction.

The Portuguese government has already revealed that it is in talks with the European Commission for the reprogramming of the RRP, in terms of funds and adaptation of projects.

Approved in 2021, the Portuguese RRP has a total allocation of €16.6 billion, €13.9 billion in grants and €2.7 billion in loans.

In information published on the Government’s website during the public consultation on the revision, last April, one reads that the RRP will have a maximum allocation of 20.6 billion euros, “representing an increase of about 2.3 billion euros in subsidies and 1.6 billion euros in loans, compared to the plan approved in July 2021.

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